The Chinese government said Tuesday it plans to impose new tariffs on $60 billion worth of U.S. exports. President Trump has threatened to punch back by hitting Chinese goods worth more than quadruple that amount.
The tit-for-tat threats risk derailing plans for bilateral trade talks aimed at de-escalating the trade war.
On Monday, the Trump administration announced new import taxes on $200 billion in Chinese goods.
Trump responded to China’s $60 billion pledge later Tuesday by declaring, “if there’s retaliation against our farmers and our industrial workers and our ranchers, if any of that goes on, we are going to kick in another $257 billion,” according to The Wall Street Journal. “We don’t want to do it, but we’ll probably have no choice.”
On the list of items to be tariffed are steel trailer wheels, inflatables and boats in general, National Marine Manufacturers Association president Thom Dammrich told Trade Only Today.
The list of goods targeted in China’s retaliatory tariffs was not available Tuesday afternoon, but Dammrich said the trade war is causing companies to pull back on future investment plans until they see how things play out.
“This is further escalation, and it gets us further from a solution and leads us further down the path toward a long-term trade war,” Dammrich said. “In general, that’s not good.”
While applauding the president for taking a stand against China, which has pressured companies to hand over intellectual property as a cost of doing business there, Dammrich was concerned there was no progress on stalled trade talks and tariffs on Canada, Mexico, and the European Union.
“If we could get a North American Free Trade Agreement, and a free trade agreement with the E.U., that would go a long way to reducing the impact of all this,” Dammrich said.
Companies are seeing costs spike. At the Newport International Boat Show last weekend, several companies said they are being directly affected by tariffs. Imtra said it received a shipment of windshield wiper kits that was 25 percent more expensive than it had been the month prior. Another company said it was spending $100,000 more on stainless steel rails.
“We’re seeing these kinds of effects rippling throughout the supply chain,” Dammrich said. “What’s worse is that these tariffs are implemented on very short notice, so it’s very difficult to deal with sudden rising costs.”