American farmers caught in the middle of global trade war

Marcus Newton
June 17, 2018

The Trump administration announced a 25 percent tariff on up to $50 billion worth of Chinese imports on Friday, instantly escalating a trade dispute between the world's two largest economies.

"These tariffs are essential to preventing further unfair transfers of American technology and intellectual property to China, which will protect American jobs", he said.

The president has been threatening tariffs against China since USA officials concluded that Beijing abuses American intellectual-property rights.

Trump has made a number of tariff-related threats.

That mirrored the Trump administration's announcement on Friday of tariff increases on $34 billion in Chinese goods, also due to take effect from July 6, and plans to consider widening it to an additional $16 billion worth of other products. These products will undergo further review in a public notice and comment process, after which USTR will issue a final determination.

The U.S. imported $506 billion of goods from China a year ago and exported about $130 billion, leaving a 2017 deficit of $376 billion, according to government figures.

About 500 goods initially targeted for sanctions in March were stricken from the list at the behest of United States firms that rely on imports.

The list of 659 U.S. goods to face tariffs in China was longer than a preliminary list of 106 goods published by the commerce ministry in April, although the value of products affected remained unchanged at $50 billion.

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Tariffs on the remaining 114 items, including chemicals, medical equipment and energy products, will start later.

Some also argue that eliminating our barriers to trade is good for USA consumers whether other countries lower theirs or not. He further said the China's decision to impose tariffs on U.S. products was necessiated by the circumstances that arose out of the USA violations of worldwide obligation.

China called on all countries to take action against the US' "outdated and regressive behaviour". The list will contain 800 product categories, down from 1,300 previously.

Beijing also has announced plans to cut import duties on autos and some consumer goods and to ease limits on foreign ownership in auto manufacturing, insurance and some other industries, though those don't directly address USA complaints. The U.S. imported more than $2.7 billion in Chinese seafood past year, and the U.S. exported more than $1.3 billion to China.

A spokeswoman for grain trader Archer Daniels Midland also said bilateral dialogue should be pursued, adding that China "continues to be an important export market for American food and agriculture".

Brussels, Ottawa, Beijing and Mexico City already have shown they intend to inflict damage on export industries in politically-sensitive voting districts - something which could prove damaging to Republicans already facing a loss of power in November's mid-term elections. Mexico has already retaliated with its own tariffs on United States goods. And those higher tariffs could discourage foreign consumers from buying USA products, exacerbating the trade deficit.

"President Trump is fixated with tariffs, which he believes he can wield freely; but there are grave consequences to the use of tariffs", said AAFA president Rick Helfenbein.

The announcements immediately sent businesses and industry groups scrambling to figure out if items in their supply chains would be targeted, and how higher costs from tariffs could affect their bottom lines.

Other reports by MaliBehiribAe

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