The proposed third tranche of 25 percent Section 301 tariffs on Chinese imports targets equipment “critical for the build-out” of 5G mobile phone technology, the Internet of Things and “big data,” according to K.C. Swanson, Telecommunications Industry Association director-global policy, in prehearing testimony posted in docket USTR-2018-0026. Though the Office of the U.S. Trade Representative hasn’t released a schedule of witnesses to testify at four days of public hearings on the tariffs beginning Aug. 20, Swanson is scheduled to testify Aug. 21, she said. Requests to testify were due Aug. 13 under the deadline USTR Robert Lighthizer extended from July 27 when he announced Aug. 1 he will “consider,” under President Donald Trump’s direction, raising the third tranche of proposed duties to 25 percent from 10 percent (see 1808010070).
Section 301 (too broad)
Imports at the major U.S. retail container ports set record highs in June and July and appear poised to set a third in August, the National Retail Federation said in an Aug. 9 news release. It’s all the result of retail sales rising and retailers “rushing to bring merchandise into the country” ahead of the proposed Section 301 tariffs on $200 billion worth of products from China, NRF said. “Tariffs on most consumer products have yet to take effect but retailers appear to be getting prepared before that can happen,” said Jonathan Gold, NRF vice president-supply chain and customs policy. “We’re seeing new record levels every month this summer. Much of that is to meet consumer demand as tax reform and a thriving economy drive retail sales, but part of it seems to be concern over what’s to come. The good news for consumers is that avoiding tariffs holds off price increases that will inevitably come if the reckless and misguided trade war is allowed to continue.” U.S. ports handled 1.85 million 20-foot-long cargo containers or their equivalents in June, a 7.8 percent increase from the same month a year earlier, NRF said, citing its own Global Port Tracker report. It estimates ports handled 1.88 million containers in July, a 4.4 percent increase year-over-year, and forecasts August container imports will be up 4.4 percent to 1.91 million, it said. “The volatility and non-fact-based decisions coming from Washington have created uncertainty" in the retail sector, said Hackett Associates, the contractor that compiled the port-tracking statistics for NRF.
A recent Agriculture Department report lists the specific food and agriculture tariff lines included in planned new Chinese tariffs (see 1808030013). "The supplementary tariffs are primarily on products which had not been previously impacted by the [Sections] 232 and 301 initial retaliatory duties, with the exception of eight [Harmonized System] codes," the USDA said in its Global Agricultural Information Network report. The new tariffs would apply in addition to the previously imposed retaliatory tariffs, it said. The new tariffs were announced in response to proposed U.S. tariffs on $200 billion worth of goods under Section 301 (see 1808010070).
The Office of the United States Trade Representative released the final list for the second tranche of Section 301 tariffs on Aug. 7. CBP will begin the collection an extra 25 percent in tariffs on those goods from China starting Aug. 23, the USTR said in its announcement.
International Trade Today is providing readers with some of the top stories for July 30 - Aug. 3 in case they were missed.
China responded to proposed U.S. tariffs on $200 billion worth of goods under Section 301 with a new tariff threat of its own on Aug. 3. The Chinese Ministry of Commerce announced plans to add tariffs of between 5 percent and 25 percent on 5,207 items, said to account for about $60 billion worth of goods from the U.S. The Office of the U.S. Trade Representative is considering imposing tariffs of 25 percent on $200 billion worth of Chinese goods (see 1808010070). "The US measures have deviated from the consensus of the two sides, leading to an escalation of trade friction between China and the United States, serious violations of relevant rules of the World Trade Organization, and damage to our national interests and people's interests," the Ministry of Commerce said, according to an unofficial translation.
Tariffs "show up as a tax on the consumer and wind up resulting in lower economic growth” that can sometimes bring about "significant risk of unintended consequences,” Apple CEO Tim Cook said in Q&A on the company’s quarterly earnings call on July 31. Several trade agreements “are in need of modernizing,” but in most situations, “tariffs are not the approach to doing that,” Cook said. Risks of macroeconomic issues such as an economic slowdown or currency fluctuations related to tariffs are difficult to quantify, “and we're not even trying to,” Cook said. None of Apple’s products was affected by the U.S. tariff on steel and aluminum, which took effect in June, nor two other Section 301 lists totaling about $50 billion in goods from China that were implemented.
As critics continue ratcheting up their opposition to the Trump administration’s proposed third round of Section 301 tariffs on $200 billion in Chinese imports, it remains to be seen how the Office of the U.S. Trade Representative will accommodate all who have requested to testify in five-minute slots during four days of public hearings scheduled to begin Aug. 20. Well more than 300 people in various industries filed requests in docket USTR-2018-0026 by the July 27 deadline to appear at the hearings, virtually all of them to say they'll testify against the tariffs.
International Trade Today is providing readers with some of the top stories for July 23-27 in case they were missed.
The U.S. trade relationship with China "significantly impacts” Consumer Technology Association member companies, large and small, because they “rely on the global supply chain -- including China -- to conduct business,” said Sage Chandler, CTA vice president-international trade. She asked to appear at Aug. 20-23 public hearings to oppose 10 percent Section 301 tariffs proposed in a July 10 Office of the U.S. Trade Representative notice. CTA members identified 302 tariff lines of Chinese imports in the notice, accounting for more than $109 billion in value, for which 10 percent duties “would be detrimental to their business,” Chandler said in her July 27 filing. CTA is still gathering “relevant data” on the tariffs’ possible impact on members, and the numbers she cited may need to be “updated” by the time written comments are due Aug. 17, she said.