Is President Trump Winning the Trade War? China Expected to Cut Tariffs on $75 Billion of U.S. Goods

On February 6, 2020, China revealed that it would cut tariffs on $75 billion of goods by half to fulfill its end of its bargain after recently signing a trade agreement with Washington.

Starting on February 14, China will reduce tariffs on some American goods from 10 percent to 5 percent. Tariffs on other items will be lowered from 5% to 2.5%, according to China’s Ministry of Finance.

The tariffs were slapped on in September and December in the midst of a protracted trade scuffle between the two superpowers.

The U.S. government has already rolled out plans to scale back tariffs on certain Chinese imports that were flagged during the trade war. However, most tariffs will stay in place.

Beginning on February 14, 2020, the U.S. will reduce tariffs on approximately $120 billion in Chinese goods — which include electronics and apparel — from 15 percent to 7.5 percent according to the U.S. trade representative’s office. This also complies with a pledge made under the U.S.-China trade agreement that was signed on January 15.

The tariff cuts come at a time where there are doubts about Beijing’s willingness to comply with the phase-one trade deal, in which China promised to increase its purchases of American goods and services by $200 billion during the timespan of two year.

Despite such concerns, the decision to reduce tariffs shows some willingness on the part of Chinese leadership to carry out the deal that effectively ended the two-year trade conflict between the two countries.

In a statement that came alongside Thursday’s announcement, the Finance Ministry said the decision was aimed at alleviating “economic and trade frictions and expand economic and trade cooperation” between the two countries. “We hope to work with the United States towards the ultimate elimination of all increased tariffs,” it added.

This is a good first step, however the Trump administration must continue pressuring China. China’s ambitions go beyond economic transactions.

Given its authoritarian nature, China is seeking to expand its reach through trade deals and migration. The Trump administration will need to maintain economic pressure and create migration policies that keep Communist Party agents from doing harm within the American border.

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