U.S. President Donald Trump threatened to extend U.S. tariffs to an additional $267 billion worth of Chinese goods in comments made on Friday, September 7.
Trump said the new round of tariffs will “take place very soon, depending on what happens.” He added a new list of goods to be affected by the tariffs is ready to go and could be rolled out on short notice, according to the Wall Street Journal.
Trump’s administration previously announced tariffs on $200 billion of Chinese goods on 11 July. That was a follow-up on his levying of tariffs on $50 billion worth of Chinese goods in June, and China’s equivalent response later that month.
“If the United States insists on imposing another round of tariffs on Chinese products, China will definitely take countermeasures to safeguard its legitimate rights and interests,” Chinese Foreign Ministry spokesman Geng Shuang said following publication of Trump’s threat on September 7.
Trump and senior trade officials in his administration are debating how to structure the $200 billion in already-announced tariffs. Specifically, they are debating whether to immediately impose a 25 percent tariff, or to phase in a tiered structure of tariffs, with some rates as low as 10 percent, according to the Financial Times.
Despite the initial rounds of tariffs, China’s exports to the United States actually rose over the summer, up 13.3 percent in July and 13.4 percent in August, reaching $44.4 billion. Likewise, Chinese imports of U.S. goods also rose, reaching $13.3 billion, an increase of 11.1 percent. That totals extended China’s trade surplus with the United States to an all-time high of $31 billion.
The high trade totals over the summer are likely the result of exporters front-loading orders before the U.S. government’s latest round of tariffs take effect, according to Gai Xinzhe, an analyst at the Bank of China’s Institute of International Finance in Beijing, speaking to Bloomburg.
“With further large-scale U.S. tariff measures imminent, Chinese exporters will be hit hard and China’s GDP growth rate in 2019 is likely to be dented,” said Rajiv Biswas, Asia Pacific chief economist at IHS Markit in Singapore, told Bloomberg. “If the U.S. keeps ramping up its tariff measures against China, the export sector will face a long, hard road ahead despite government measures to mitigate the impact.”