The stock market has already seen some wild fluctuations this week in anticipation of the latest volley in a trade war ramping up between the U.S. and China. Now it seems the president is making good on his promise to further increase tariffs on goods from the country. Documents posted to the Federal Register (via Reuters) note that the U.S. is set to increase import tariffs on $200 billion worth of Chinese goods from 10 to 25%. The change, which targets products already singled out by the September 2018 tariffs, is set to go into effect on Friday, May 10.
“In the most recent negotiations, China has chosen to retreat from specific commitments agreed to in earlier rounds,” the document notes. “In light of the lack of progress in discussions with China, the President has directed the Trade Representative to increase the rate of additional duty to 25 percent.”
Trump addressed the topic of tariffs (per usual) on Twitter this morning, without directly confirming the new increase. “China has just informed us that they (Vice-Premier) are now coming to the U.S. to make a deal,” he wrote. “We’ll see, but I am very happy with over $100 Billion a year in Tariffs filling U.S. coffers…great for U.S., not good for China!”
As he notes, Chinese Vice Premier Liu He is scheduled to discuss existing and looming trade issues with the president on Wednesday and Thursday of this week. Many were hoping the meetings could help avoid another sharp increase on tariffs, though the White House appears to have jumped the gun — perhaps as a negotiating tactic ahead of talks.
A wide range of U.S. industries have been impacted by existing tariffs, ranging from leather to steel to consumer electronics. The latter has been a tricky one to unpack, given how devices like smartphones tend to source components and software from both countries. The initial document notes that the U.S. Trade Representative will seek to exclude certain goods, though no specifics have been named yet.