China’s Tariffs on U.S. Agricultural Products Take Effect

China’s Tariffs on U.S. Agricultural Products Take Effect

Beijing began imposing tariffs on Monday on many farm products from the United States, for which China is the largest overseas market. It is the latest escalation of a trade fight between the world’s two largest economies.

The Chinese government announced the tariffs last week, shortly after President Trump raised tariffs on Chinese products for the second time since he took office in January. The Chinese tariffs will include a levy of 15 percent on U.S. products like chicken, wheat and corn, as well as 10 percent on products like soybeans, pork, beef and fruit.

Beijing said that goods that had already been shipped before Monday and imported by April 12 would not be subject to the new tariffs. Because crops like soybeans, wheat and corn, in particular, tend to travel by sea, this means that China’s customs officials will actually collect few tariffs until shipments arrive in China after leaving the United States on Monday or later.

A spokesman for the National People’s Congress, which is now holding China’s annual legislative session, said last week that Mr. Trump’s latest tariffs had “disrupted the security and stability of the global industrial and supply chains.”

The Chinese government also said it was blocking 15 U.S. companies from buying Chinese products unless it granted special permission, including a manufacturer of drones that supplies the U.S. military. And it said it was blocking another 10 U.S. companies from doing business in China.

Mr. Trump has contended that tariffs are needed on imports from China, most of which are manufactured goods, to allow the United States to rebuild its industrial sector and also to generate tax revenue for the federal budget. He imposed a 10 percent tariff on almost all imports from China in early February, and raised the tariff to 20 percent last week. He has said the actions were intended partly to pressure China to reduce the flow of the opioid fentanyl into the United States.

Mr. Trump also imposed 25 percent tariffs on Canada and Mexico last Tuesday, though he abruptly suspended many of those levies two days later.

He has added 20 percent tariffs to the roughly $440 billion worth of Chinese goods that the United States imports annually. The average U.S. tariff on affected Chinese goods now stands at 39 percent, up from 3 percent when Mr. Trump began his first term eight years ago. Other than China, Canada and Mexico, the United States collects tariffs averaging about 3 percent on most countries.

Despite the recent escalations in the trade war between Washington and Beijing, both sides have signaled that they may be open to a compromise. Last week, China’s commerce minister told reporters that he had invited his American counterpart and the U.S. trade representative to a meeting. And last month, Mr. Trump said that a new trade deal with China was “possible.”

Monday’s levies are not the first time in recent weeks that China has responded in kind to Mr. Trump’s trade actions. After the president imposed 10 percent tariffs in early February, China said it would place tariffs on natural gas, coal and farm equipment purchased from the United States.

But the United States has more targets in a trade war because Americans purchase far more goods from China than the Chinese purchase from Americans. This enabled the United States to one-up China relatively easily after China imposed reciprocal tariffs on U.S. goods during Mr. Trump’s first term.

But Mao Ning, a spokeswoman of the Ministry of Foreign Affairs, contended at the ministry’s daily briefing on Monday that nobody should be imposing extra tariffs. “Trade wars and tariff wars all start with harming others and end with harming oneself — the United States should learn lessons and change its course,” she said.

China faces a more troubled domestic economy now than during President Trump’s first term. It is hamstrung by economic problems including weak foreign investment and the aftermath of a real estate bust.

Still, China has other tools for managing the ongoing trade skirmish. In the past, it has cut taxes on Chinese companies that export goods to the United States, enabling them to cut prices and dampen the effects of a U.S. tariff.

Chinese companies have also moved final assembly of their products to countries like Vietnam and Mexico, with which the United States has had relatively free trade relations in recent decades. But Mr. Trump has tried to tighten this loophole by threatening tariffs on Mexico.

And Chinese companies have sought to exploit the so-called de minimis rule, which exempts packages from tariffs if their value is $800 or less. Mr. Trump has tried to crack down on this practice, but the crackdown proved complicated to execute, and Mr. Trump has largely paused the effort.

Zixu Wang contributed research from Hong Kong.

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