October 15, 2019 12:00 AM NPT
President Donald Trump slapped tariffs on Chinese imports in 2018 in a bid to cut the U.S. trade deficit. In the same year, Chinese exports to the U.S. soared by $34.5 billion, while U.S. exports to China fell by $9.6bn. The president’s tariffs under Section 232 and Section 301 threaten nearly $550 billion of goods imported from China. Under Section 232, the president can impose trade barriers if the Department of Commerce finds that imports threaten national security. Section 301 enables tariffs or quotas when the United States Trade Representative finds “unfair trade practices.”
Section 232 hit steel with a 25 per cent levy and aluminium with 10 per cent. Three lists later, under section 301, Trump has raised tariffs to 25 per cent on $250bn of Chinese imports. Now the latest Lists 4A and 4B start at 15 per cent, along with a threat to raise Lists 1 through 3 to 30 per cent. Altogether, Trump’s six tranches of tariffs could increase import and consumer costs by over $100bn annually. In addition to raising costs for American consumers, Trump’s self-lauded negotiating tactics have also resulted in retaliation by other countries against U.S. exports. Five nations -- China, India, Turkey, Russia and the EU -- have levied retaliatory tariffs on more than $104bn of U.S. exports.