As the U.S.-China trade dispute appears to continue cooling off, the latest development sees China announce plans to halve tariffs on around $75 billion worth of U.S. goods.
Going into effect on Feb. 14, the move will see the rate on some American imports slashed from 10% to 5%, with levies on other goods dropping from 5% to 2.5%.
“To ease economic and trade tensions and expand cooperation, the Chinese side decided to adjust related measures accordingly,” read a statement from a Chinese Ministry of Finance official. “Further adjustment will mainly depend on future development in the economic and trade relations between the two countries. It is our hope that both sides will work together toward ultimately removing all additional tariffs.”
For nearly two years, China and the U.S. were engaged in a tit-for-tat trade dispute, which saw both governments slap new levies on hundreds of billions of dollars worth of goods.
Last month, the U.S. and China signed a “phase one” trade agreement, which addresses intellectual property protection as well as promises more Chinese purchases of U.S. goods. The partial agreement also eased nearly two years of tensions between the world’s two largest economies as the United States agreed to pull back back certain planned tariff hikes.
However, under the “phase one” agreement, certain tariffs already implemented on hundreds of billions of dollars worth of Chinese products remain. Those levies will stand until a “phase two” agreement is reached. Shoe industry leaders have been united in their belief that a “phase two” agreement is critical.
“[W]e strongly urge the President to continue to negotiate a phase two deal that puts an end to all the new tariffs he raised in order to give U.S. footwear companies some much-needed certainty and increase opportunities for job and sales growth,” said Matt Priest, president and CEO of the Footwear Distributors & Retailers of America.
Steve Lamar, president and CEO of the American Apparel & Footwear Association shared similar thoughts: “Frankly, the fact that we are still charging these punitive tariffs on any products — on top of the already high tariffs our industry pays — means American consumers, workers, and companies are still feeling the full force of the trade war.”
As trade war negotiations continue, companies that do business in China are also concerned about the deadly coronavirus outbreak. International brands such as Nike, H&M and Adidas have opted to close some of their outposts in the country to help stem the spread of the illness. Additionally, factories and corporate offices in China have stalled operations, while several U.S.-based trade shows that were anticipating international attendees have been postponed amid widespread travel restrictions implemented by the U.S. government over the weekend.
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