New Tariffs on China: Initial Reactions and Possible Outcomes

by contributing writer Emily Colby

The White House has implemented new tariffs on China. This news comes just days after the conclusion of the North Korean Summit in Singapore. It has been announced that the tariff will represent about 25 percent of 50 billion USD worth of goods coming from Chinese exports. The official list of sanctioned goods has yet to be released from Washington.

Beijing immediately fought back with warnings of future imposed barriers on US exports from China of equal value to those the US has announced it will impose. If these retaliatory measures are put in place, we can pretty much assume that we are finally headed into that trade war that has been talked about for months now.

The fact that this news broke after the North Korean Summit is significant. China provided help to bring the summit to fruition. It is likely that President Trump did not want to muddy the waters with China until after a summit had taken place. At a press conference in Singapore following the summit’s conclusion, President Trump suggested regretfully that in spite of his good relationship with Chinese President Xi Jinping, tariffs may be a necessary action due to Beijing’s alleged failure to properly close off its borders to trade with North Korea in recent months. “I have to do it. I have no choice. For our country, I have to do it,” said President Trump.

While Beijing has something of a history supporting tariffs on Pyongyang, it has a much stronger history of economic ties to the North Korean capital. For instance, bilateral trade between the two cities increased ten times between 2000 and 2015. When China cooperated with US and UN demands last year to initiate new sanctions on North Korea, China did so reluctantly. Now, after both the US and South Korea appear to have had successful meetings with the North, Beijing may feel a little jealous. It did not help that when the two Korea’s met, they suggested future collaboration with Washington to draft a treaty in the future to officially end the Korean War. China took quick note, and offense, at its inclusion in such talks not being mentioned. For Beijing, any serious American efforts to heal its relationship with North Korea may be seen as a threat.

The White House appears to share some of the same voices of dissent as China in the decision to impose these new tariffs. Tom Donohue, president and chief executive of the U.S. Chamber of Commerce appears to be one of those not in favor. “Imposing tariffs places the cost of China’s unfair trade practices squarely on the shoulders of American consumers, manufacturers, farmers and ranchers. This is not the right approach,” said Donohue.

The decision comes as a victory for others though, including Treasury Secretary, Robert E. Lighthizer, who has been pushing for harsher economic policy on China for months.

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