Another chapter of this story has been written, as President Donald Trump announced on Friday that the U.S. will indeed impose more tariffs on China. Specifically, a 25% tariff on a variety of Chinese exports number over 1,100 products totaling around $50 billion.
China immediately said they would retaliate with tariffs of their own before accusing the U.S. of starting a trade war.
The justification from the Trump administration? They had it coming. These tariffs are designed to work as a punishment on China for their espionage against us, stealing trade secrets and technology.
“(Trade) has been very unfair, for a very long time. This situation is no longer sustainable,” Trump said later in a statement.
This decision has been in the works for several weeks now, as we previously reported that Trump was looking into different tariffs against China. This came after both sides seemed to come to a deal that had China buying billions in U.S. agriculture. Neither side is looking to back down.
China already has a list of products they claimed to impose tariff’s on if Trump went through with his threat, including transportation and agriculture. They also said they would immediately cancel any recent trade deals made.
“In this day and age, launching a trade war is not in the interest of the world. We call on all countries to act together to firmly stop such an outdated and backward move, and to firmly safeguard the common interest of all mankind,” said China’s Commerce Ministry.
All of this comes not even a week removed from the G7 Summit held in Canada. After fighting with our closest allies over trade, Trump seemed to have angered everyone, including the entirety of the European Union.
Every country has vowed retaliation.
These particular tariffs are set to hit in two waves. The first will come in July and will cover about $34 billion worth of products. The second will come later, so it would seem to be undecided just yet.
Perhaps the time given before these tariffs take hold is a good sign that Trump is holding out hope that a new trade deal will be signed for the betterment of both countries.
Trump has touted unfair trade practices against China and the rest of the world during his campaign. He promised he would put America back on top of trade dominance, hoping it would give a boost to U.S. industries.
“We have a tremendous intellectual property theft problem. It’s going to make us a much stronger, much richer nation,” Trump said in March when he first brought up imposing tariffs this year.
As a citizen, it can be difficult to see how taxing foreign goods will make us a stronger country. This tit-for-tat retaliation will end up forcing the world’s top economic powers to engage in a trade war that threatens to not only hurt jobs, but the extra costs will translate down to the consumer, making products we use every day much more expensive.
Update: As I wrote up this article, China announced their own 25% tariff on about 695 U.S. goods worth near $50, which will hit on July 6th.