On Monday, September 17, 2018 President Trump announced that he directed the USTR to proceed with placing additional tariffs on roughly $200 billion of imports from China. Set to take effect on Monday, September 24, 2018 at ten percent and rising to twenty-five percent on January 1, 2019, these tariffs will be applied to 5,745 full or partial lines of the originally proposed 6,031 tariff lines announced on July 10, 2018. The full list which includes food, car parts, furniture, and electronics can be viewed here.
After the review period, more than 300 categories were removed from the list, including safety gear, children’s play pens, safety seats, highchairs and smart watches. However, President Trump has threatened further tariffs if China attempts to retaliate to this announcement.
According to CNBC, China is looking at adding tariffs on an additional $60 billion of US goods effective 9/24. These tariffs will impact 5,207 US products at a five-ten percent level as a retaliation for the new list of items.
Negotiations between the US and China will continue through these tariffs as the two sides try to find common ground in the trade dispute. As the Chinese economy is slowing there is belief that they will be more accessible to negotiations regarding intellectual property and opening their market to US interests. Unlike the first rounds of tariffs, which were scheduled to lessen the impact on US consumers, this new round is expected to drive up prices on retail goods and could lead China to halt exports to the US of components necessary to many US supply chains. While some companies have started looking for new markets to fill in where cargo from China has become too expensive, the rerouting of meticulously planned supply chains will cost US companies time and money.
We at Coppersmith understand that navigating these issues and new tariffs can be complex and daunting and we encourage you to contact your Coppersmith representative if you have questions or concerns.