U.S. Tariff Threat Could Scuttle Planned Trade Talks With China

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The United States plans to impose a 25-percent tariff on a number of Chinese goods.

The final list of covered imports will be announced by June 15, and tariffs will be imposed on those imports shortly thereafter, it said.

Tensions between the US and China may have been reduced somewhat by Trump's action last week to ease sanctions that threatened the viability of Chinese telecom giant ZTE, in response to a personal request from President Xi Jinping.

This includes products related to the "Made in China 2025" program.

In addition to the tariffs, the White House also announced forthcoming restrictions on Chinese investment in USA tech companies.

In addition to affecting Chinese companies that export products into the US, the tariffs could also affect multinational OEMs that have shifted their manufacturing to China to take advantage of lower labor costs.

Officials in the Trump administration have sought to distance ZTE from the trade talks, but the president previously linked the two issues. The dispute began in March, when his administration threatened to slap tariffs on up to US$50 billion in Chinese shipments to punish Beijing for violating American intellectual property rights.

Earlier this month, the U.S. Department of Defense banned all smartphones and mobile modems from Chinese manufacturers ZTE and Huawei on all U.S. military bases worldwide.

U.S. to Impose 25% Tariff on Tech Goods From China - White House
The statement added. "This is obviously contrary to the consensus reached between the two sides in Washington not long ago". The US will request that tariffs and taxes between the two countries be reciprocal in nature and value.

China responded the next day with a $50 billion list of its own, which heavily targeted agricultural and chemical products and which Beijing has vowed to impose as soon as the US moves forward with its tariffs. USA officials have long accused China of stealing American intellectual property.

The White House repeated it will slap a hefty 25 per cent tariff on as much as $50bn worth of imports.

"We were both surprised by and expecting the statement issued by the White House".

Other advisers have pushed for tougher action, demanding that China make substantial reforms to its economy to end the subsidies it provides to developing industries and to allow American companies equal access in the Chinese market.

Separately, on Friday, the US reached a deal on ZTE Corp. that will allow the Chinese telecommunications giant to remain in business.

The announcement, which offered little new information, comes as Commerce Secretary Wilbur Ross prepares to travel to Beijing this week for another round of talks aimed at resolving the conflict, which includes a threat of matching sanctions from China on U.S. goods.

In mid-May, China agreed to increase purchases of U.S. agriculture and energy products, and last week, the U.S. Commerce Department told lawmakers it had reached a deal to put Chinese telecommunications firm ZTE Corp back in business.

The US will move forward with a complaint against China at the World Trade Organization.