Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

U.S. Rushes to Ready New China Tariffs as Companies Fear Damage

Economy Aug 07, 2019 10:28PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 

(Bloomberg) -- The Trump administration is rushing to finalize a list of $300 billion in Chinese imports it plans to hit with tariffs in a few weeks’ time, as U.S. companies make a last-ditch appeal to be spared from the latest round of duties.

President Donald Trump’s announcement last week on adding a 10% tariff as of Sept. 1 to virtually every Chinese import that’s not yet subject to punitive duties took U.S. Trade Representative Robert Lighthizer by surprise, people familiar with the discussions said. Lighthizer and his staff are now under pressure to revise an initial list targeting more than 3,800 Chinese product lines based on issues raised during a public comment period and hearings.

The USTR is planning to publish the final list this week or early next, the people said. In that meantime, companies are making a last-ditch attempt at convincing the Trump administration not to impose duties or to drop items they import from the tariff list.

In a meeting shortly before the president announced the new duties, Lighthizer argued against the new tariffs. He instead urged patience to allow more time for a tariff increase in June to 25% from 10% on an earlier batch of $200 billion worth of Chinese imports to inflict pain on the Chinese economy, the people said.

A USTR spokesman disputed that account, and said the agency was following the same legal process as it had in previous tariff rounds. Trump decides when the tariffs will go into effect and USTR will publish the final list before the effective date, the spokesman said.

Still, companies are complaining about the lack of certainty for their business decisions and say a couple weeks’ notice isn’t enough time.

“Companies don’t plan by tweet,” Jon Gold, of the National Retail Federation, said. “These are all contracts that are already executed and cargo is on the water.”

Imaginary Elves

After Trump and his Chinese counterpart Xi Jinping agreed on yet another tariff truce in late June, businesses didn’t expect another escalation this soon and felt like they had more time to plan, Gold added. Companies and trade associations are still trying to weigh in with the administration to make their case and potentially get their products taken off the list.

The proposed list of goods, which USTR published in mid-May, includes consumer items like smart-phones, laptops, clothes and toys.

Jay Foreman, the chief executive of Basic Fun! toy company in Florida, which makes the Lite-Brite and other products, said he’ll have no choice but to reduce employees by the same percentage as the duty.

“We are not making toys here using imaginary elves from the from North Pole,” Foreman said Wednesday on conference call with reporters arranged by Tariffs Hurt the Heartland, a campaign of trade groups opposed to the tariffs. “American workers are designing, developing, selling, shipping and trucking our toys.”

White House economic adviser Larry Kudlow this week signaled the tariffs could be called off before Sept. 1 if Beijing shows goodwill on buying American agriculture goods and getting back to the negotiating table.

“The president and our team is planning for a Chinese visit in September,” Kudlow said Tuesday on CNBC. “Movement toward a good deal would be very positive and might change the tariff situation. But then again, it might not.”

It’s not clear if businesses are able to submit requests for product exclusions once the duties are imposed. For previous lists, such an option was only available once the tariff rate was bumped up to 25%. It’s also not clear whether the Sept. 1 date applies to the date when the item arrives in the U.S. or when it leaves China -- a critical question for importers because of the amount of product that is already on the water traveling to America.

Of the almost 13,750 exclusion requests submitted for the initial tariffs imposed last year on $50 billion in goods, only 23% have been approved as of Aug. 2. About 60% were rejected and the rest are still being revised, government data show. Companies can file for exclusions in the last round of tariffs on $200 billion of products until Sept. 30.

Win Cramer, the chief executive officer of California-based JLab Audio, said he was in Minneapolis on Wednesday visiting with two retailers -- and instead of talking about holiday plans, they were discussing tariffs. It’s impossible to plan because of the uncertainty of what Trump will do next, he said.

“The answers aren’t there yet because we don’t know what we don’t know,” Cramer said on the conference call. “These decisions are made with a tweet, they can also as easily be reversed with a tweet. So we’re kind of in wait-and-see mode.”

U.S. Rushes to Ready New China Tariffs as Companies Fear Damage
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (7)
David David
David9 Aug 08, 2019 3:13AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
I have been telling you guys ... China is fully ready for battle. The more US ramps up tarriffs, the faster the economy will crumbled. President Xi Jing Ping is sitting back, relax, and watching Trump destroyed the US market. Xi has Trump exactly where he wants him. The right time will come when Xi put on the last blast and nailed Trump so hard he won't be able to recovered. China is a genius are market battle.
James Pattison
James Pattison Aug 08, 2019 1:00AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
And manufacturing leaves communist china
Chris Cummins
Chris Cummins Aug 08, 2019 1:00AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Headed to Vietnam?
Jack AAA
Jack_A Aug 08, 2019 12:42AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
As Trump said, China pay the tariff. the more you hit, the more they pay. the best deal, or the worst lie?
Jason Zou
Jason Zou Aug 08, 2019 12:08AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Just slam 1000% teriffs on anything from China, American would enjoy themselves happily ever after. No rush, just do it now, simple as a rock.
Michael Angelo
Michael Angelo Aug 07, 2019 11:57PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
The plan for the Chinese is to force US to play free the currency and interest rates down to rattle the hegemony from US. If they win day goodbye to the empire, no more power manufacturing dollars that is the best and main American product.
Silverbug 19
Silverbug 19 Aug 07, 2019 10:53PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
So sorry. Maybe should of not taken advantage of the American worker this long either.
Ravjir Urjinee
Ravjir Urjinee Aug 07, 2019 10:53PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Sorry who? We are gonna pay for the extra 10-25%. Almost 80% products made in China including your medicine. How are they gonna suffer? Do you know how much it cost to move supply Chains? Also they wont be coming back here, theyll be moving to another asian country! Wish people understood how Economy works!! Blame the Fed for inflating our Currency away for years and low interest rates wich got us here!!
Lloyd McCord
Lloyd McCord Aug 07, 2019 10:43PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
These same overpaid traitorous CEOs who sold out American workers by manufacturing in an autocratic communist dictatorship are now crying about their decades long betrayals being corrected? SERIOUSLY? Do these global corporatists have any shame whatsoever? They're like fat kids stealing cake and then crying about having eaten it all. Time to make it right rich boys!
Jack AAA
Jack_A Aug 07, 2019 10:43PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
where's your business for creating jobs?
Chris Cummins
Chris Cummins Aug 07, 2019 10:43PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Confused. "Sold out American workers"...over the last 10 years unemployment has dropped from 8+% to under 4%. And the jobs are hugging paying than the manufacturing jobs. So how did they *****over the workers? Creating good jobs does sound horrible, how can we ever fix it?
Chris Cummins
Chris Cummins Aug 07, 2019 10:43PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Auto correct...hugging should be better
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email