BEIJING • China will grant exemptions on retaliatory duties imposed on 696 US products, the most substantial tariff relief to be offered so far, as Beijing seeks to fulfil commitments made in its interim trade deal with the United States.
The announcement yesterday came after the phase one trade deal between the two countries took effect last Friday and is the third round of tariff exemptions China has offered on US goods.
China has committed to boosting its purchases of goods and services from the US by US$200 billion (S$278 billion) over two years as part of the agreement, and has already rolled back some additional tariffs on US imports after the deal was signed.
US goods eligible for tariff exemptions include key agricultural products such as pork and beef, as well as energy products like crude oil, which were subject to extra tariffs imposed during the escalation of the bilateral trade dispute.
But the coronavirus epidemic that emerged late last year in China has raised concerns about its ability to meet the purchasing targets.
The authorities throughout the country imposed major restrictions on travel and transport to curb the spread of the virus, which has killed nearly 1,900 people and infected more than 70,000 in the country.
The containment efforts have kept factories shut or operating with drastically reduced staff, hitting production. The public has also been discouraged from leaving their homes or going to public places, stunting consumption.
White House economic adviser Larry Kudlow said earlier this month that Chinese President Xi Jinping had told US President Donald Trump during a recent call that China will still meet its phase one trade deal purchasing targets.
Beijing's announcement yesterday emphasised that Chinese firms will submit applications for tariff exemptions based on market conditions and commercial considerations.
"Unless the state forcefully asks firms to apply for tariff exemption and buy US soya beans, crushers would still go for Brazilian beans," said a trader, adding that Brazilian beans are of good quality and price this year.
Some medical devices and metals including copper ore and concentrates, copper scrap and aluminium scrap are also subject to exemption.
Pharmaceutical products such as recombinant human insulin and some antibiotics are also among US products eligible for tariff exemptions.
Firms can start submitting their applications on March 2 and any exemptions granted will be valid for one year.
REUTERS
