President Trump took a bold and historic move by imposing $50 billion tariffs on Chinese goods thereby severely limiting its investment in US technology. The move is a sharp response to the Chinese policy of allowing US firms to do business in China on the cost of surrendering their trade secrets. President has issued directions to his Trade Representative Robert E. Lighthizer to publically announce the entire list of products which will come in the ambit of current tariffs in next 15 days. The primary aim behind the move is to press China to shun its unfair trade practices.
The new tariffs will directly hit nearly 1300 products but the administration expects that the consumers will not have much impact. Trump has also directed Lighthizer to launch a complaint against China in WTO about its unfair licensing practices for foreign firms. There were positive indications that US allies will get a temporary exemption from some metal tariffs on steel and aluminium imports. Thus, EU, Brazil, South Korea and Argentina will be spared. Furthermore, new investment restrictions will also be worked out for Chinese investors.
President Trump has shown swinging changes on his stance on China ranging from extreme praise for Xi Jinping to being strict about its trade practices. The Trump’s trade agenda released in February had labelled China as a hostile economic power. The new tariffs have completely put an end to years of economic engagement between the two nations and have sparked the fears of a trade war.