US Administration has escalated a stringent move on trade by announcing a 25 percent tariffs on Chinese imports amounting to USD 50 billion. This has come in as a response to the protest against Beijing policies requiring foreign companies to hand over their technology.
The proposed list of products subjected to additional 25 percent tariffs are based on an extensive interagency economic analysis and would target products that are benefitted from Chinese plans while minimizing the impact on the American economy.
The sectors targeted in the list include products from aerospace, communication and information technology, robotics and machinery. About 1300 different tariff lines in the proposed list will undergo a review in a public notice followed by a hearing post which a final list of products subject to additional duties will be issued by USTR.
China, on the other hand, has imposed tariffs on 128 American products amounting USD 3 billion as a retaliation against US duties.
Earlier in March, Trump had announced that it would impose duties on Chinese imports and take similar actions in response to Chinese policies that target US companies in handling technology and property to Chinese firms.
While interacting with media during Baltic Leaders Meet, Trump said,
We have a problem with China, they have created a trade deficit, and frankly, our representatives are not to be blamed. With a $500 billion trade deficit every year we cannot entertain it for long.The theft of intellectual property alone amounts to $200-300 billion .We haven’t had such a situation ever before, and the U.S has to do something on trade involved with other countries.
On the other hand, many industrial groups came forward and openly opposed US President’s proposal of imposing tariffs on Chinese products.
Robert D Atkinson, President of Information Technology and Innovations Foundations (ITIF), said, “While it is right to retaliate against China’s abuse of economic and trade policy, imposing tariffs on goods will adversely affect Americans affecting capital and reducing productivity growth.”
“The focus instead should be on things that could generate more leverage over China without increasing prices and dampen investment in equipment, aerospace, and technology that drive innovation and promote productivity in the economy.”, he said
On the contrary, U.S lawmakers have supported Trump’s action.
“Publishing a preliminary list is a crucial step that would allow U.S companies to study implications and effects of tariffs on our economy. We are confident this way we would be able to protect national security by keeping a check on unfair trading practices”, said Kevin Brady, Chairman at House Ways and Means Chairman.
Dave Richert, Trade Chairman at Ways and Means Subcommittee showed his support by saying its high time for U.S to address China’s theft for technology and the action is well justified that will put a check on it.