President Donald Trump said the U.S. will impose a 10% tariff on all Chinese goods that have hitherto been spared from the protectionist push as the latest trade talks between the two countries failed to yield anything productive.
Alain Sherter had the news for CBS:
President Trump is renewing a threat to impose additional tariffs on Chinese imports. Barring a trade deal, starting Sept. 1 the U.S. will apply a 10% tariff on $300 billion in Chinese goods, he tweeted Thursday.
Financial markets, which had jumped in morning trade, fell into negative terrain immediately after Mr. Trump’s tweets. The Dow went from a gain of 270 points Thursday to a loss of 180 points moments after Mr. Trump tweeted his threat — a swing of more than 450 points. It closed the day down 280 points, or 1%, to 26,583. The broader S&P 500 stock index and tech-heavy Nasdaq composite also slid on the tweet.
Oil markets plunged almost 8% — the steepest one-day drop in more than four years, Bloomberg News reported — on worries that a trade war would slow the global economy and drag down demand for energy.
CNN’s Katie Lobosco, Kevin Liptak, and Abby Philip quoted Trump’s tweets and noted the adverse effect of more tariffs on the U.S. economy:
“Trade talks are continuing, and during the talks the U.S. will start, on September 1st, putting a small additional tariff of 10% on the remaining 300 billion dollars of products coming from China into our country,” he tweeted.
Later in the day, Trump said in remarks to reporters at the White House that he might still ratchet tariffs up to 25%, as he’s previously threatened — or even higher.
“It can be lifted in stages so we’re starting at 10% and it can be lifted up to well beyond 25%,” the President said. “But we’re not looking to do that, necessarily.”
The new tariffs could hit US consumers harder than the earlier rounds. It would tax goods like iPhones and other consumer electronics, sneakers and toys. Last year, Trump imposed tariffs on about $250 billion in Chinese-made goods, targeting industrial materials and components.
“We’re taking in many billions of dollars. There’s been absolutely no inflation and frankly it hasn’t cost our consumer anything. It cost China,” Trump said in his remarks, adding that companies are now moving out of China to avoid the tariffs.
In fact, economic studies show that US consumers, not China or other foreign importers, are bearing the weight of the duties. The White House’s most recent Economic Report of the President, released in March, acknowledged that any benefit from the tariffs is offset by “costs paid by consumers in the form of higher prices and reduced consumption.”
AP reported the Chinese side had been one again quick to warn retaliation:
China’s government has threatened unspecified “necessary countermeasures” if Trump’s planned tariff hike goes ahead.
The Commerce Ministry said Trump’s announcement is a violation of his agreement with President Xi Jinping in June to revive negotiations aimed at ending their fight over Beijing’s trade surplus and technology ambitions.
The ministry said if the U.S. measures took effect, “China will have to take necessary countermeasures to resolutely defend its core interests.”
The statement issued Friday continued, “All the consequences will be borne by the United States.”
Trump said Thursday he will impose 10% tariffs Sept. 1 on the remaining $300 billion in Chinese imports he hasn’t already taxed.
The president earlier imposed 25% tariffs on $250 billion in Chinese products. Beijing retaliated by raising import duties on $110 billion of U.S. goods.