On August 2nd, President Trump told reporters waiting outside of the White House that he would be instituting tariffs on all imports from China that haven’t yet been covered by other sections or exclusions. The tariffs are set to go into effect on September 1st, giving both sides time to continue negotiations. The duty rate itself is also in question pending the negotiations; it stands at 10% but can rise to 25% if talks break down.
In response to the tariff announcement, China devalued its currency to 7 yuan = 1 US dollar, a threshold most financial experts described as a red line for devaluation. China also stopped any new purchases of US agriculture products. The agriculture issue has been a bone of contention between the nations during the whole of negotiations as soy bean farmers were incredibly hard hit by the first waves of tariffs. One point made by President Trump during the announcement of this 4th tranche was the bad faith with which China failed to increase purchases of US agricultural products while negotiations proceeded.
While accusations run back and forth as to whether China devalued the yuan specifically to attack Trump because they knew it was a sore spot or if they did it because during the talks they’d prevented the natural devaluation to maintain peaceful negotiations remains to be seen. Concerns for a global recession exploding out of these talks and maneuvers is getting louder than ever as both nations keep trying to find common ground, between taking shots back and forth.
We at Nelson International know how crucial news of the trade statuses between the US and China are to our readers. We’ll be keeping these stories updated as more information develops. If you have questions or concerns on how the new tariffs can impact your cargo, reach out to your Nelson representatives.
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