Amid an ongoing trade war with the Trump administration, China’s Ministry of Finance made a significant announcement this week that prompted some proud retweets from the president.
“China will lower import tariffs on over 850 products from January 1,” reported Reuters in a post Trump promoted Sunday evening.
“China says it will cut import tariffs for goods including frozen pork, pharmaceuticals, paper products and some high-tech components starting from Jan. 1, according to a statement from the Ministry of Finance,” Bloomberg Economics reported Sunday evening in another post tweeted out by Trump.
“U.S. president Donald Trump says a ‘breakthrough’ has been achieved in trade talks with China and he expects a deal to be signed ‘very shortly,'” reported Sky News in another Trump retweet.
BREAKING: China says it will cut import tariffs for goods including frozen pork, pharmaceuticals, paper products and some high-tech components starting from Jan. 1, according to a statement from the Ministry of Finance https://t.co/D0cIcHVda1 pic.twitter.com/ODlcciZjuV
— Bloomberg Economics (@economics) December 23, 2019
U.S. president Donald Trump says a "breakthrough" has been achieved in trade talks with China and he expects a deal to be signed "very shortly"
— Sky News Breaking (@SkyNewsBreak) December 21, 2019
China will lower import tariffs on over 850 products from January 1 https://t.co/rOyxOnY9QF pic.twitter.com/8xmiyGmiW6
— Reuters (@Reuters) December 23, 2019
The Reuters report highlighted by Trump provides some of the big takeaways from China’s announcement, which comes amid cooling tensions in the U.S.-China trade war after the two countries announced a “Phase 1 agreement that would reduce some U.S. tariffs in exchange for more Chinese purchases of American farm products and other goods”:
Next year, China will implement temporary import tariffs, which are lower than the most-favored-nation tariffs, on more than 850 products, the finance ministry said on Monday. That compared with 706 products that were taxed at temporary rates in 2019.
The tariff changes were made to “increase imports of products facing a relative domestic shortage, or foreign specialty goods for everyday consumption,” the ministry said in a statement on its website.
Bloomberg calculates the total value of the list of 859 product types for which China is reducing tariffs to be worth “some $389 billion, or about 18% of China’s total imports of $2.14 trillion.”
“China cut import tariffs on a wide range of goods including food and parts for manufacturing smart-phones, continuing Beijing’s drive to spur domestic demand and demonstrating its desire to open its economy as it pursues a trade deal with President Donald Trump,” Bloomberg reports.
Among the products that will enjoy lower tariffs this year is frozen pork, which Bloomberg notes is intended to help China alleviate shortages after an outbreak of African swine fever.
Bloomberg notes that the reduction of tariffs on the hundreds of products is not directly related to China’s trade war with the U.S., but “it suggests the government is willing to embrace commerce more,” particularly because of its slowing economic growth.
With its growth predicted to drop to 6% or less next year, China is demonstrating to the world that it is willing to embrace “freer trade,” economist Gary Ng told Bloomberg. “The move in lowering import tariffs reflects that the government wants to reaffirm its stance to the world on freer trade amid the trade war,” said Ng. “Domestically, lowering import tariffs are helpful in reducing business and consumer costs.”
China’s announcement comes less than a week after Trump enjoyed another economic win. Within hours of being impeached by the Democrats on entirely partisan lines, apart from a few Democrats joining Republicans in opposition, the House overwhelmingly passed the new Trump-promoted United States-Mexico-Canada Agreement (USMCA) by a vote of 385-41.
Related: Trump Gets Massive Post-Impeachment Victory As USMCA Passes House