NY TIMES
WASHINGTON — The United States and China intensified their trade dispute on Monday, as Beijing said it would increase tariffs on nearly $60 billion worth of American goods and the Trump administration detailed plans to tax nearly every sneaker, computer, dress and handbag that China exports to the United States.
NY Times: Toys, Phones and Sneakers: The Chinese Goods Trump Wants to Tax Next
An escalation of the president’s trade war with China is poised to hit every conceivable consumer product, and then some.The escalation thrust the world’s two largest economies back into confrontation. While President Trump said on Monday that he would meet with China’s president, Xi Jinping, next month in Japan, the stakes are only increasing as the president continues to taunt and threaten China, causing it to retaliate on American businesses.
Financial markets fell on Monday after China detailed plans to increase tariffs, with the S&P 500 index down more than 2.4 percent for the day and more than 4 percent this month. Shares of companies particularly dependent on trade with China, including Apple and Boeing, fared poorly, and yields on three-month Treasury securities exceeded those on 10-year bonds, a sign that investors may be souring on the outlook for short-term economic growth. The Dow Jones Industrial Average was down over 600 points for the day.
China’s Finance Ministry announced Monday that it was raising tariffs on a wide range of American goods to 20 percent or 25 percent from 10 percent. The increase will affect the roughly $60 billion in American imports already being taxed as retaliation for Mr. Trump’s previous round of tariffs, including beer, wine, swimsuits, shirts and liquefied natural gas exported to China.
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| Among the products that will be hit by higher levies is seafood from China imported into the United States.
Wu Hong/EPA, via Shutterstock
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The move came after Mr. Trump increased tariffs on $200 billion of Chinese goods to as much as 25 percent on Friday, and threatened to move ahead with taxing the remainder of goods that the United States imports from China. The Office of the United States Trade Representative released a list on Monday of the roughly $300 billion worth of products that could face up to a 25 percent tariff and requested public comment, which will begin the formal process for enacting those duties. The list includes almost every consumer product imaginable, from coffee makers to sneakers to telescopic sights for rifles.
Economists and industry groups were not sanguine.
“Americans’ entire shopping cart will get more expensive,” said Hun Quach, the vice president of international trade at the Retail Industry Leaders Association, which represents Best Buy, Walmart, Target, Dollar General and other stores.
Rick Helfenbein, the president of the American Apparel & Footwear Association, called the measure a “self-inflicted wound” that he said would be “catastrophic.” While footwear and apparel were largely spared from Mr. Trump’s first two rounds of tariffs, they are on the list of items that would be taxed if the president follows through with his threat to raise taxes on an additional $300 billion worth of goods.
“By tightening the noose and pulling more consumer items into the trade war, the president has shown that he is not concerned with raising taxes on American families, or threatening millions of American jobs that are dependent on global value chains,” Mr. Helfenbein said.
Both China and the United States have left a window for negotiators to try to reach a deal before the latest round of higher tariffs goes into effect. China said it would delay the higher rates until June 1, while Mr. Trump’s new 25 percent rate affects only products sent to the United States as of May 10, leaving a two- to four-week gap from the time most goods leave China by boat to when they arrive at an American port.
Economists and industry groups were not sanguine.
“Americans’ entire shopping cart will get more expensive,” said Hun Quach, the vice president of international trade at the Retail Industry Leaders Association, which represents Best Buy, Walmart, Target, Dollar General and other stores.
Rick Helfenbein, the president of the American Apparel & Footwear Association, called the measure a “self-inflicted wound” that he said would be “catastrophic.” While footwear and apparel were largely spared from Mr. Trump’s first two rounds of tariffs, they are on the list of items that would be taxed if the president follows through with his threat to raise taxes on an additional $300 billion worth of goods.
“By tightening the noose and pulling more consumer items into the trade war, the president has shown that he is not concerned with raising taxes on American families, or threatening millions of American jobs that are dependent on global value chains,” Mr. Helfenbein said.
Both China and the United States have left a window for negotiators to try to reach a deal before the latest round of higher tariffs goes into effect. China said it would delay the higher rates until June 1, while Mr. Trump’s new 25 percent rate affects only products sent to the United States as of May 10, leaving a two- to four-week gap from the time most goods leave China by boat to when they arrive at an American port.
But the two sides would have far to go to quickly resolve what has once again become a heated economic dispute. Progress toward a trade agreement between the United States and China nearly collapsed over the past two weeks, after American negotiators accused China of reneging on substantial portions of a potential trade agreement it had previously committed to. Significant differences remain over how tariffs should be rolled back between the countries, and whether the negotiated provisions must be enshrined in Chinese law.
