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Trade Dispute: China Retaliates By Slapping Tariffs On U.S. Products

RACHEL MARTIN, HOST:

President Trump is targeting China on trade, and now China is fighting back. Starting today, the Chinese government will be imposing 3 billion dollars' worth of new tariffs on a list of U.S. products. This is retaliation for the Trump administration's tariffs on imported steel and aluminum. NPR's Rob Schmitz joins us now, live from Shanghai. Hey, Rob.

ROB SCHMITZ, BYLINE: Good morning, Rachel.

MARTIN: What exactly are we talking about here? What U.S. products are going to take a hit?

SCHMITZ: This is a long and wide-ranging list. We have 128 products, from apples and berries to pork products, recycled aluminum, ethanol. And the tariffs that'll be slapped on these American products when they enter China will range from 15 percent to 25 percent. In a statement, China's ministry of commerce said, quote, "we hope that the United States will rescind its measures that violate World Trade Organization rules as quickly as possible." And those measures that Beijing is talking about are, of course, the tariffs that the U.S. has imposed on steel and aluminum imports from countries like China.

MARTIN: Wow. So this is clearly retaliation for that. Can you just put this into context? I mean, now that we've got these new Chinese tariffs on U.S. goods, what kind of real impact is this going to have?

SCHMITZ: Well, you know, the U.S. exports more than 115 billion dollars' worth of goods to China. So $3 billion over 120 products is, in trade terms, a drop in the bucket. China seems to be purposely avoiding America's biggest exports to China, which would include soybeans, sorghum and commercial jets made by Boeing. They're not on this list. What is interesting here is that a lot of the products on this tariff list are produced in rural or working-class regions of the U.S., areas that voted for Trump in the 2016 election. What's also interesting is that when Beijing announced this list a couple weeks ago, it did so saying it would impose these tariffs if Beijing and Washington could not come to an agreement on Trump's threat of across-the-board tariffs on Chinese imports. So we weren't sure that these tariffs would actually come from China. But suddenly today Beijing just went ahead and approved them. So this seems like a significant escalation in this trade standoff between the U.S. and China.

MARTIN: Because the across-the-board tariffs on Chinese imports by the Trump administration haven't happened yet? Could still happen?

SCHMITZ: They have not. No. I mean, so we're still in a waiting period. So we're waiting for the Trump administration to come up with a list of Chinese products that it wants to target with around 60 billion dollars' worth of tariffs. U.S. Trade Representative Robert Lighthizer still has a week to deliver on that. Once that's done, there's supposed to be a month-long comment period before the Trump administration finalizes and then implements those tariffs. So we've still got some time for negotiation between the China and the U.S.

MARTIN: Wow. But this is still China fighting back, even before the U.S. has levied even more severe China-specific tariffs?

SCHMITZ: Yeah. That's right. It seems to be a strategy from Beijing that says, look, you know, I know that you're looking at putting these big tariffs on us, but we're just going to do this right now...

MARTIN: Preemptive strike.

SCHMITZ: ...And there's probably more where this comes from.

MARTIN: Right. Are the two sides talking at all? I mean, is there dialogue? Are there trade negotiators who are actually in rooms trying to hammer this out?

SCHMITZ: Yeah. Liu He, China's vice premier, has spoken to Steve Mnuchin, the U.S. treasury secretary, reportedly telling him that China hopes that the two countries will try to stay rational and work together to maintain the overall stability of their economic relations. U.S. Senator Elizabeth Warren spent this past weekend speaking to Chinese officials in Beijing, and she says they haven't really deviated at all from their talking points on the Trump tariff. So we've still got some time here, but April could be a pretty intense month as the world's two largest economies prepare to duke it out on, you know, these trade issues.

MARTIN: All right. To be continued, for sure. NPR's Rob Schmitz joining us live from Shanghai this morning. Hey, Rob, thanks so much.

SCHMITZ: Thank you. Transcript provided by NPR, Copyright NPR.