Trump puts China on notice for US$60b worth of tariffs

He gives US Trade Representative 15 days to publish list of Chinese goods to be targeted

President Donald Trump has ordered the US Trade Representative (USTR) to publish in 15 days a list of Chinese products that it intends to target with sanctions.

Senior administration officials who briefed journalists yesterday on the eve of the President's announcement said this will be followed by a 30-day period for public comment and consultations before tariffs are actually imposed.

Mr Trump said the US will levy up to US$60 billion (S$79 billion) worth of tariffs to compensate for what the US deems as China's predatory economic practices.

An investigation last year by the US under Section 301 of the 1974 Trade Act found evidence of China's use of state-funded entities to acquire American companies and American technology, and coercion of American companies in China into joint ventures as minority partners.

It also found that American companies have been forced to hand over technology that Chinese companies then used to compete against the same American companies in China and globally.

Section 301 authorises the President to take all appropriate action, including retaliation, to force a foreign government to change practices that the US deems unjustified, unreasonable or discriminatory, and that burden or restrict US commerce.

The officials said the action was being taken after wide inter-agency consultations, against a backdrop of years of failed negotiations with China, and in line with casting China as a strategic competitor to the US in the President's National Security Strategy.

In the US' new National Security Strategy issued last December, it was noted that "China engages in strategic economic aggression against the United States", said Dr Peter Navarro, director of the Office of Trade and Manufacturing.

"This was a seismic shift," he said yesterday. Previous administrations, and the Trump administration, had "tried very, very hard to work with the Chinese", "and finally the President determined we need to move forward", he said.

Mr Everett Eissenstat, deputy director of the National Economic Council, said the report of the Section 301 investigation "clearly demonstrates that there are unfair practices by China, in particular as relating to their efforts to acquire US technology and to favour Chinese companies over US companies".

China also supports and conducts "unauthorised intrusions into and theft from US computer networks and US companies. These findings are very well documented, the report is extremely solid and quite persuasive", he said.

Mr Trump has directed the USTR to pursue dispute settlement in the World Trade Organisation to address China's "discriminatory licensing practices".

He has also asked the Treasury to propose executive actions to address concerns about unfair acquisitions in the US in industries for technologies deemed important to the US.

Meanwhile, US Trade Representative Robert Lighthizer said yesterday that Europe, as well as six countries - Argentina, Australia, Brazil, Canada, Mexico and South Korea - will be exempt, at least temporarily, from hefty steel and aluminium tariffs.

He told a Senate panel that Mr Trump authorised a "pause" in the tariffs while talks are under way to find a more permanent solution, and that the US wanted to wrap up the discussion with countries over exemptions by the end of next month.

Mr Trump announced earlier this month that he was imposing a 25 per cent tariff on imported steel and 10 per cent on aluminium.

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A version of this article appeared in the print edition of The Straits Times on March 23, 2018, with the headline 'Trump puts China on notice for US$60b worth of tariffs'. Print Edition | Subscribe