Treasury Secretary Steve Mnuchin sent a strong message to Chinese leadership Sunday, announcing he “wouldn’t minimize” the possibility of levying tariffs on all $500 billion worth of goods the U.S. imports from China annually.
The treasury secretary’s comments came ahead of central bank chiefs and finance ministers at the G-20 summit in Buenos Aires.
President Donald Trump made the same threat Friday in an interview with CNBC’s “Squawk Box,” claiming he was readying to “go to 500,” a reference to the total value of all Chinese imports.
The administration has already levied tariffs on hundreds of billions of dollars worth of Chinese goods. In early July, the White House announced a 25 percent tariff on $34 billion worth of Chinese exports of machinery, electronics and other components. The administration followed that up July 10 with plans to impose a 10 percent tariff on $200 billion worth of Chinese products. (RELATED: US To Hit China With $200 Billion Worth Of Tariffs)
Any new tariffs would be in addition to the 25 percent tariffs the administration has already enacted on $50 billion worth of goods that “contain industrially significant technologies,” a move that the U.S. hopes will help stop intellectual property theft on the part of Chinese manufacturers. (RELATED: Stocks React To China Tariffs)
Trump is adamant China is benefitting from unfair trade practices at the cost of the American worker, arguing the U.S. has lost out to China for decades, as they steal intellectual property and manufacturing jobs.
For their part, China has responded in kind to the president’s tariffs, issuing its own set of tariffs on America products. In many cases, Chinese tariffs impact areas that voted for Trump in the 2016 presidential election cycle. (RELATED: Mnuchin: President ‘Isn’t Afraid’ Of A Trade War)
While China exports $500 billion worth of goods and services to the U.S. annually, the U.S. only exports roughly $130 billion to China each year. That has the administration feeling secure in its position, arguing, like Mnuchin and the president have in recent months, that the U.S. has the upper hand against China in the ongoing negotiations.
Still, there is fear of a trade war with China the longer the negotiations play out. China is responding to Trump’s tariffs with their own set, but they could use other non-tariff measures, like instituting barriers to entry for American companies in Chinese markets, as another retaliatory tactic should the U.S. move forward with tariffs on $200-500 billion worth of Chinese goods.
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