The punitive tariffs imposed on more than $300 billion worth of Chinese imports under the Trump administration have been under a statutory review period. Bloomberg reports that the Trump administration initially invoked Section 301 of the US Trade Act to impose punitive tariffs on Chinese goods.
Despite the current soaring inflation at 7%, these tariffs, which make products more expensive, may still be subject to further review.
The Biden administration has so far shown little willingness to eliminate these tariffs, as Chinese authorities have not fully implemented their promised plans to purchase US goods, and the relations between the two countries are deteriorating rather than improving.
President Joe Biden on January 19th said, “It was too soon to make commitments on lifting US tariffs on Chinese goods,” according to Reuters.
On February 9th, Reuters, citing officials from the largest US business lobby group, said that the US administration was considering a new China tariff probe; if their negotiations with China failed to persuade Beijing to follow through on promised purchases of US goods, energy, and services.
The Trump administration and Chinese authorities reached a so-called “first phase trade agreement” in early 2020. Beijing promised to increase purchases of $200 billion of US goods in exchange for the gradual withdrawal of US tariffs.
However, with Beijing not complying with the agreement to purchase more US goods, Bloomberg reports that the Biden administration is leaning toward not withdrawing the tariffs, potentially making these punitive tariffs on China permanent.
According to an article in the Wall Street Journal on March 2nd, in its annual policy plan released on Tuesday, the Office of the United States Trade Representative stated that it is realigning its China policy without providing any additional details on specific measures.
The USTR said in a report to Congress on February 16th, “It is apparent that existing trade tools need to be strengthened, and new trade tools need to be forged.”
The US government levied the first tariffs on China between March and April 2018; therefore, the legal time for a review has come. As mentioned by Bloomberg, the review process needs to be completed within 60 days, which is July 6th for the first batch of $34 billion in Chinese goods.