China to cut import tariffs by half on certain US imports

On Thursday, February 6, China affirmed it would cut the additional tariffs applied to 1,717 US products last year by half, after the signing of Phase 1 of the agreement that guaranteed a truce in the trade war between the two largest economies in the world.

According to Reuters, although the announcement echoes the US commitment under the agreement, it is also seen by analysts as a move by Beijing to boost confidence amid the virus outbreak that has affected companies and investor sentiment. However, the prospect raised in the local media is that Beijing may invoke a disaster-related clause in the trade agreement, which may allow it to avoid repercussions even if it fails to fully meet the goal of purchasing U.S. products and services for 2020.

The Chinese Ministry of Finance said in a statement that, as of 2:01 am (Brasília time) on February 14, additional tariffs applied to some products will be cut from 10% to 5% and others from 5% to 2.5%.  The ministry did not say the value of the products affected by the decision, but the products that benefit from the new rule are part of the US$75 billion in products to which last year China applied a tariff hikes from 5% to 10%.

In a separate statement, the Ministry of Finance said the tariff cuts correspond to those announced by the United States on Chinese products, which are also scheduled for February 14. Further adjustments will depend on developments in the bilateral economic and trade situation, the ministry said.

Source: Reuters

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