China’s finance ministry announced on Monday evening that it would proceed in raising tariffs on roughly $60 billion worth in American goods beginning June 1, 2019.
Beijing will increase tariffs on more than 5,000 products to 20 percent or 25 percent from the previous 10 percent imposed last fall.
As of now, China has not extended the duties to any new set of goods.
The retaliation follows President Donald Trump’s decision to raise duties on $200 billion in Chinese products from 10 percent to 25 percent and effectively escalate the pressure in the ongoing trade war.
The new tariff hike will be based on four categories of U.S. goods:
CATEGORY 1: Includes cotton, machinery, grains: Increases to 25 percent from 10 percent.
CATEGORY 2: Includes aircraft parts, optical instruments, & various types of furniture: Increases to 20 percent from 10 percent.
CATEGORY 3: Includes corn flour, wine: Increases to 10 percent from 5 percent.
CATEGORY 4: Includes certain types of chemical, rare earths, medical equipment like ultrasound and MRI machines: Remains at 5 percent.
The June 1st implementation will allow time for negotiators to make one last push for a deal between the two countries, but it is unclear when a fair negotiation will arise. As a result, stock in both Chinese and American markets fell today.
Shippers are urged to contact their Customs brokers and freight providers to review impact on their supply chains.
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