Trump announces wide ranging tariffs on Chinese imports
March 22, 2018
After announcing tariffs on steel and aluminum imports a few weeks ago, President Trump said in a speech that he plans on proposing additional tariffs specifically focused on China.
The DOW Jones fell 724 points following Trump’s announcement. It’s speculated that the tariffs can be up to $60 billion in worth. Trump is using a presidential memorandum that will allow him to implement tariffs without the need of Congress approval.
“We don’t exactly know what the composition of the tariffs is going to look like because there’s a consultation period that has to be undergone,” Jonas Gamso, assistant professor at ASU’s Thunderbird School of Global Management, says. “It does look like he’ll be targeting high tech though.”
Gamso says it’s natural for the public to feel a little panicked, especially after watching the stock market fall. However, he emphasizes that there’s nothing to do but wait to see how it plays out.
“China has tools that they can use if they decide to retaliate against the U.S.,” Gamso says. “I think it remains to be seen. This consultation period will give China the chance to finally see what these tariffs are going to look like to sort of strategize how best to address them.”
There’s concern that the tariffs will cause prices to raise which is highly likely. Gamso explains that consumer prices will likely increase due to the fact that it will be more expensive to buy from China. Producers have two options: buy costly goods from overseas or buy from American producers who can only produce at a higher price than China. Those extra prices are going to be passed to the consumers.
Gamso says the major basis of Trump’s announcement was the lack of intellectual process protection. China has the option to challenge some of the accusations by bringing it to the World Trade Organization.