ECONOMY

Trump signs order taking aim at $50 bln in Chinese imports

US President Donald Trump signs trade sanctions against China in the Diplomatic Reception Room of the White House in Washington, DC, on March 22, 2018. (AFP)

President Donald Trump will impose tariffs on at least $50 billion in Chinese goods imports to retaliate against the alleged theft of American intellectual property, White House officials said on Thursday.

Saying it would be the “first of many” trade actions, Trump signed the order that also will look at restrictions on Chinese investment in the US.

“We have a tremendous intellectual property theft situation going on,” Trump said.

“It is the largest deficit of any country in the history of our world,” Trump said of the US-China trade imbalance, blaming it for lost American jobs.

He said his action would make the country stronger and richer.

The new import duties will target industrial sectors where “China has sought to acquire an advantage through the unfair acquisition or forced technology transfer from US companies,” senior White House economic advisor Everett Eissenstat told reporters.

The products subject to the new tariffs have not yet been identified.

But the move sent stocks diving on Wall Street, where the Dow Jones Industrial Average was down about two percent ahead of the announcement, and ratcheted up Trump’s confrontational stance with trading partners.

Proposed list of products

Trump will direct US Trade Representative Robert Lighthizer to identify publish a proposed list of products that could be subject to tariffs.

He will also direct Lighthizer to take action against China at the World Trade Organization, charging Beijing with preventing US companies from licensing their technology in China.

The measure also directs the US Treasury to develop new proposals to increase safeguards on investments that could compromise US national security.

China has already warned that it will take “all necessary measures” to defend itself, raising the prospect of a trade war between the world’s two biggest economies.

The White House said Thursday that Trump would direct the Office of the US Trade Representative to publish a list of proposed tariffs for public comment within 15 days. USTR has already identified potential targets: 1,300 product lines worth about $48 billion.

The president is also asking Treasury Secretary Steven Mnuchin to come up with a list of restrictions on Chinese investment.

Trump will impose tariffs on about $50 billion in Chinese goods imports to retaliate against the alleged theft of American intellectual property, White House officials said. (AFP)

White House officials said on Thursday the actions capped years of efforts to encourage China to end the alleged unfair practices through negotiations.

“Those dialogues failed under the Bush and Obama administrations,” White House Trade Advisor Peter Navarro told reporters.

Navarro said Trump had been at pains to encourage Beijing to cooperate with American entreaties to open Chinese markets and end unfair practices.

“The problem is that with the Chinese in this case talk is not cheap, it’s been very, very expensive and finally the president decided we needed to move forward.”

As Trump has taken progressive steps toward confrontation, Beijing has repeatedly warned that trade wars benefited no one and that China would not stand idly by as Washington imposed punitive new measures.

American industry, and US agriculture in particular, have voiced exceptional concerns that Trump’s moves could spark retaliatory measures and hurt US exporters.

But Navarro told reporters that China benefitted far more from trade relations with the United States than the reverse, meaning retaliation could be difficult for Beijing.

The new moves on China come weeks after the White House suddenly announced punishing new import tariffs on steel and aluminum, which have outraged trading partners and Republican lawmakers alike.

European officials this week have made high-level visits to press their case that they be excluded from the tariffs -- which are due to take effect on Friday.

To target China, Trump has dusted off a Cold War weapon for trade disputes: Section 301 of the US Trade Act of 1974, which lets the president unilaterally impose tariffs. It was meant for a world in which large swaths of global commerce were not covered by trade agreements. With the arrival in 1995 of the World Trade Organization, which polices global trade, Section 301 fell largely into disuse.

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Last Update: Thursday, 22 March 2018 KSA 20:51 - GMT 17:51
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