WASHINGTON — President Donald Trump ratcheted up trade tensions with China even further on Friday, announcing that he will impose 25-percent tariffs on Chinese technology imports worth roughly $50 billion.
The tariffs, the first round of which is set to take effect on July 6, will primarily target products containing “industrially significant technologies,” like aerospace, robotics and automobiles.
The move is aimed at cracking down on Beijings policies that the White House says force foreign companies to hand over valuable technology and data in order to operate in the Chinese market. But it also marks a significant escalation of trade tensions between the worlds two largest economies and threatens to derail ongoing trade talks between the two countries, including plans for Beijing to purchase more U.S. agricultural and energy products.
Beijing will respond in kind to the American tariffs, a Chinese government spokesman said Friday.
Trump said Friday that while Chinese President Xi Jinping is his “friend,” the actions were necessary to “straighten out” the U.S.-China trade relationship and protect U.S. intellectual property and technology industries.
“Were going to protect those secrets,” he said on “Fox and Friends.” “You know those are the crowned jewels of our country. … We have the great brain power right in this country.”
More than 800 products worth roughly $34 billion — including from sectors such as industrial machinery and information and communications technology — will face tariffs on July 6, the Office of the U.S. Trade Representative said in a separate statement Friday. That list is focused on products from industrial sectors but steered clear of commonly purchased goods, like cellphones and televisions, in what USTR said was an effort to minimize direct effects on U.S. consumers.
The administration also highlighted an additional 284 products worth roughly $16 billion that were not on its original list, which was released in April. Those will have to undergo a public comment and review process, and tariffs, if approved, will not be in place for several weeks.
The U.S. also said it will pursue additional duties if China engages in retaliatory measures like imposing new tariffs, raising non-tariff barriers or otherwise limiting U.S. exporters or companies operating in China.
U.S. Trade Representative Robert Lighthizer characterized the move Friday as something “thats been in train for a while.”
“Its thorough, its moderate, its appropriate,” he said in an interview on Fox Business. “Our hope is it doesnt lead to a rash reaction from China. Were just trying to get back to even.”
He added that the U.S. hopes the action leads to further negotiations with China and “to China changing its policies, at least with respect to us, and opening up their market.”
Beijing branded Trumps move a protectionist policy in a statement that preceded the White Houses announcement Friday morning. “If the U.S. takes unilateral and protectionist measures that harm Chinese interests, we will respond immediately by taking the necessary decisions to safeguard our legitimate rights and interests,” Chinese foreign ministry spokesman Geng Shuang said, according to an official readout.
China is expected to retaliate with penalties of its own that will target U.S. exports to China worth roughly the same amount as the Chinese goods that would be hit by Trumps tariffs.
When the administration initially released a preliminary list of $50 billion in Chinese goods that it intended to target, China responded a day later with a $50 billion list of its own that was heavy on agricultural products like soybeans — a crop that is crucial to Trumps political base in the U.S. heartland — as well as cars and aircraft.
Farm groups quickly voiced concerns that Trumps move against China on Friday could lead to retaliation that would deal a serious blow to an industry that has struggled in recent years amid stubbornly low commodity prices.
“For American farmers this isnt theoretical anymore, its downright scary,” Brian Kuehl, executive director of the advocacy group Farmers for Free Trade, said in a statement Friday. “Its no longer a negotiating tactic, its a tax on their livelihoods.”
Some lawmakers and business groups added their voices to the chorus of opposition, warning that while Chinas intellectual property practices need to be addressed, tariffs are not the right approach.
“Tariffs will harm American and Chinese businesses and consumers, and will put economic growth in both countries at risk,” Senate Finance Chairman Orrin Hatch(R-Utah) said in a statement. “Ill-conceived trade actions that weaken the American economy, alienate allies, and invite retaliation against American businesses, farmers and ranchers, undermine our nations ability to successfully confront Chinas unfair trade policies.”
But Senate Minority Leader Chuck Schumer backed Trumps strategy. “The presidents actions on China are on the money,” the New York Democrat said in a statement. “China is our real trade enemy, and their theft of intellectual property and their refusal to let our companies compete fairly threatens millions of future American jobs.”
The finalized U.S. tariff list marks the latest step in a series of back-and-forth trade actions between the two countries that has already resulted in duties being imposed by both sides. It also represents the first time that the Trump administration has imposed penalties on China specifically.
The White House had previously pressed pause on its rollout of the duties as the two countries pursued trade talks, but Trump appeared to lose patience last month and ordered his administration to finalize the list of targeted goods. The action appeared to be a clear statement that he wasnt happy about the direction of talks with Beijing.
The next figurative shoe to drop in the U.S.-China relationship will likely be when the Trump administration unveils a set of investment restrictions and export controls against Beijing that are also aimed at curbing Chinese acquisition of “industrially significant” technology.
The White House has said those restrictions will be announced by June 30. Lighthizer said Friday the goal is to stop China from forcing U.S. companies to hand over valuable technology and data, calling technology Americas “biggest advantage.”
Victoria Guida, Sabrina Rodriguez and Doug Palmer contributed to this report.