Mnuchin Says Further US Tariffs on China at Least a Month Away

Mnuchin
Jonathan Ernst/Reuters

The United States is studying how proposed tariff increases on roughly another $300 billion in Chinese imports will affect consumers and is at least a month away from enacting them, U.S. Treasury Secretary Steven Mnuchin said on Wednesday.

Washington earlier this month hiked existing tariffs on $200 billion in Chinese goods, prompting Beijing to retaliate, as talks to end a 10-month trade war between the world’s two largest economies stalled.

U.S. President Donald Trump, who has embraced protectionism as part of an “America First” agenda aimed at rebalancing global trade, has threatened to slap tariffs of up to 25% on an additional listing of Chinese imports worth about $300 billion.

“There won’t be any decision probably for another 30 to 45 days,” Mnuchin said at a hearing with U.S. lawmakers, adding that he had spoken with Walmart Inc’s chief financial officer about how the tariffs will impact consumer prices.

Walmart, the world’s largest retailer, has said its prices would rise because of the higher tariffs on Chinese goods.

“That’s something I can assure you the president will be focused on before we make any decisions,” Mnuchin told the U.S. House of Representatives Financial Services Committee.

Mnuchin told reporters earlier that U.S. officials were not currently scheduled to go to Beijing for the next round of negotiations, CNBC reported.

No talks between top Chinese and U.S. negotiators have been scheduled since the last round ended on May 10, the same day Trump increased tariffs on $200 billion worth of Chinese goods to 25% from 10%.

Negotiations between the United States and China have stalled since early May, when Chinese officials sought major changes to the text of a proposed deal that the Trump administration says had been largely agreed.

The Chinese government’s top diplomat Wang Yi said on Wednesday that China’s door would always be open to further trade talks with the United States, but added that Beijing would not accept any unequal agreements.

The acrimony between the two countries has intensified since last week when Washington put Chinese telecom equipment company Huawei Technologies Co Ltd on a blacklist that curbs Huawei’s access to U.S.-made components.

The move is a potentially devastating blow for the company that has rattled technology supply chains and investors.

Some mobile operators, including the Ymobile unit of Japan’s Softbank Corp and rival KDDI Corp, put launch plans for Huawei’s new P30 Lite smartphone on hold on Wednesday.

Another big Chinese tech firm, video surveillance equipment maker Hikvision Digital Technology Co Ltd, also may face limits on its ability to buy U.S. technology, the New York Times reported, citing people familiar with the matter, sending the firm’s Shenzhen-listed shares down 5.54 percent.

STRIDENT TONE

While China has not said whether or how it may retaliate to the measures against Huawei, state media have taken an increasingly strident and nationalistic tone and said Beijing will not bend to U.S. pressure.

China must prepare for difficult times as the international situation is increasingly complex, President Xi Jinping said in comments carried by state media on Wednesday.

During a three-day trip this week to the southern province of Jiangxi, a cradle of China’s Communist revolution, Xi urged people to learn the lessons of the hardships of the past.

“Today, on the new Long March, we must overcome various major risks and challenges from home and abroad,” state news agency Xinhua paraphrased Xi as saying, referring to the 1934-36 trek of Communist Party members fleeing a civil war to a remote rural base, from where they re-grouped and eventually took power in 1949.

“Our country is still in a period of important strategic opportunities for development, but the international situation is increasingly complicated,” he said.

“We must be conscious of the long-term and complex nature of various unfavorable factors at home and abroad, and appropriately prepare for various difficult situations.”

The report did not elaborate on those difficulties, and did not directly mention the trade war or the United States.

RETALIATION

U.S. firms said in a survey released on Wednesday they were facing retaliation in China over the trade war.

The American Chamber of Commerce of China and its sister body in Shanghai, said members reported they faced increased obstacles such as government inspections, slower customs clearances and slower approval for licensing and other applications.

It also said 40.7% of respondents were considering or had relocated manufacturing facilities outside China. Of the almost 250 respondents to the survey, which was conducted after China and the United States both raised tariffs this month, almost three-quarters said the levies were hurting their competitiveness.

Long considered a solid cornerstone in a relationship fraught with geopolitical frictions, the U.S. business community has in recent years advocated a harder line on what it sees as discriminatory Chinese trade policies.

The United States is seeking sweeping changes to trade and economic policies, including an end to forced technology transfers and theft of U.S. trade secrets. Washington also wants curbs on subsidies for Chinese state-owned enterprises and increased access for U.S. firms in Chinese markets.

China for years has blocked major U.S. tech firms, including Google and Facebook, from fully operating in its market. Those and other restrictions have fueled calls from within the U.S. business community for Washington to pursue more reciprocal policies.

(Reporting by Jason Lange and Michael Martina; Additional reporting by Susan Heavey in Washington and Ben Blanchard and Zhang Min in Beijing; Writing by Paul Simao; Editing by Susan Thomas)

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WellHungChad
Member

For years, American businesses have been off shoring manufacturing to China because they offer super cheap wages, total exemption from environmental restrictions, and a total disregard for their worker’s safety. These tariffs are long overdue!!! The only ones to benefit have been American manufacturing/Wall Street heads and the very few, government connected, nouveau-riche Chinese. I have long questioned the economists notion of “free” trade when it’s not “fair” trade. The drug dealer gives his product away cheap at first, too! It’s time to “Just say, NO, to China!” Trump’s timing is perfect since the economy is strong, the withdrawal from… Read more »

TOM
Member

One thing that should be recognized on both sides of this trade war is that there are other countries to get components from for the Chinese manufacturers and other countries to get finished goods for the American consumer.

TOM
Member

Once upon a time Walmart advertised its buy American policy. I guess they have gone now to a policy of DON’T buy American.

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