TRADE WAR: U.S. Delays Tariff Increases Signaling Trade Deal With China Is Likely

Washington, D.C. – President Donald Trump boosted investor and trucking stakeholder confidence on February 24th announcing his administration is delaying a new round of tariff increases on Chinese goods.

In a series of tweets on Sunday, President Trump indicated ongoing trade negotiations with China were progressing so well that he was “delaying the U.S. increase in tariffs” scheduled to take effect March 1st.

 

Transportation Nation Network (TNN) first reported in January that U.S. negotiators were mulling “ratcheting back tariffs on Chinese imports” as a way to calm global markets, while giving leaders in Beijing an incentive to make deeper trade concessions in negotiations with the U.S.

The U.S. was set to raise tariffs from 10% to 25% on $200 billion of Chinese-made products. This after the Office of the United States Trade Representative (USTR) imposed more than $250 billion in tariffs last year on a host of Chinese imports such as steel and aluminum.

President Trump campaigned in 2016 on “not allowing China take advantage of the U.S. anymore” with respect to trade, intellectual property theft, technology transfer, currency manipulation and a host of other issues.


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WHY PRESIDENT TRUMP’S “TRADE WAR” WITH CHINA MIGHT BE WORKING TOO WELL

The Trump Administration’s strategy of imposing tariffs on China, in an effort to bring them to the negotiating table, has been effective, maybe too effective. In fact, last month China released its GDP numbers for 2018 showing the slowest annual growth rate in nearly three decades, at 6.6%.

The news was even worse for global investors as economists recently polled by Rueters expected a GDP growth rate of at least 6.8%. Chinese leaders moved to downplay the impact of U.S. tariffs on the world’s second largest economy.

However, Chinese statistics bureau chief Ning Jizhe did acknowledge that his country’s trade dispute with the U.S. has affected the domestic economy, but the impact was manageable, Reuters reported. Many economists have also weighed in crediting the Trump tariffs for creating conditions to incentivize Chinese officials to negotiate new trade terms with the U.S.

 

China’s top trade negotiator, Vice Premier Liu He, visited Washington, D.C., earlier this month for two days of talks with U.S. trade representative Robert Lighthizer. The results of those negotiations and others since led to President Trump’s recent announcement.


These developments are thought to help ease tensions in global markets and bring a greater level of calm to U.S. markets even while in the midst of a healthy economy.

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