US Sets Additional Tariffs on Chinese Imports

Forex News

The US plans to move forward with further tariffs for Chinese imports, starting August 23. A 25% tariff will apply for the annual import of Chinese goods worth about $16 billion, covering about 280 items of goods, including chemicals and equipment. The Trump administration said that tariffs are intended to punish China for "unfair" trade practices.

The US Trade Representative’s Office (USTR) is also reviewing 10% tariffs on a further $200 billion in Chinese imports, and is even considering raising the rate to 25%. Those duties could be in place after a comment period ends on September 6. China in turn retaliated by proposing tariffs on $60 billion worth of US goods, with the extra levies ranging from 5% to 25%.

The US and China have been trying to restart high-level talks, after holding three rounds of formal talks. Negotiations broke off after the Trump administration imposed the tariffs on $34 billion in Chinese imports, a move the Chinese said would void any promises they’d made in negotiations.

Analysts forecast that trade war between the US and China will reduce global output by 0.7% by 2020, with China’s economy taking a 1.3% hit and US GDP dropping 1%.