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President Donald Trump abruptly escalated his trade war with China, announcing that he would impose a 10% tariff on $300 billion in Chinese imports that aren’t yet subject to U.S. duties after setbacks in negotiations with Beijing.
The new tariff will be imposed beginning Sept. 1, he said in a tweet. Another $250 billion in Chinese goods are already subject to a 25% U.S. tariff.
Treasury Secretary Steven Mnuchin and U.S. Trade Representative Robert Lighthizer returned from talks with Chinese counterparts in Shangai this week without reporting much progress. Negotiations have been at an impasse since May after the U.S. said the Chinese reneged on provisions of a tentative deal.
...buy agricultural product from the U.S. in large quantities, but did not do so. Additionally, my friend President Xi said that he would stop the sale of Fentanyl to the United States – this never happened, and many Americans continue to die! Trade talks are continuing, and...— Donald J. Trump (@realDonaldTrump) August 1, 2019
...We look forward to continuing our positive dialogue with China on a comprehensive Trade Deal, and feel that the future between our two countries will be a very bright one!— Donald J. Trump (@realDonaldTrump) August 1, 2019
State-run Chinese media called the Shanghai talks “pragmatic.” The two sides confirmed they had discussed increasing Chinese imports of U.S. agricultural products, which have fallen dramatically this year, and that they would meet again in September in Washington.
U.S. stocks pared gains on the news, while yields on 10-year Treasuries fell to the lowest since 2016.
Trump and Chinese President Xi Jinping met at the Group of 20 summit in Osaka, Japan, in June in what the U.S. said was an effort to get the talks back on track. But Trump said that China failed to fulfill a handshake agreement with Xi to buy more U.S. agricultural products.
Trump also said that Xi hasn’t met a promise to crack down on U.S. shipments of fentanyl, a dangerous opioid that has killed tens of thousands of Americans in recent years. “Many Americans continue to die,” Trump said in a tweet.