Add tariff
Time:2018/09/02     Viewed:0

People's Daily 2018-08-24 05:34
       [Abstract] Adding tariffs on Chinese goods will greatly affect various industries in the United States. Whether it is a large enterprise of tens of thousands of people or a small family business, the dependence on Chinese products is quite high, and they cannot find suitable suppliers in other countries in the short term.
       On August 23, the hearing of the US Trade Representative Office to impose tariffs on 200 billion US dollars of Chinese exports to the United States continued, and there were more and more voices against the increase of tariffs. A number of Chinese industry representatives, including Chinese-funded investment companies, industry associations, and legal persons, actively participated in the hearings. They resolutely opposed the US's tariff increase on China's products and explained the impact of US tariffs on Chinese exports to China. The US is required to exclude the industry or its products from the tax collection list in order to maintain healthy and stable Sino-US economic and trade relations.

"Maintaining healthy and stable Sino-US economic and trade relations is in the interests of both sides."

“The tariff burden will ultimately be borne by US importers and consumers, especially those who lack ready-made channels or have the ability to consume fresh citrus fruits, such as schools and elderly living centres.” Andrew Shaw, a lawyer representing Toshima Holdings, said in his speech.

Toshima Holdings is a privately owned company based in Zhejiang province. It is mainly engaged in the production of food and agricultural products. Its canned Tangerine is included in the proposed tax list for the 301 investigation. The company hired a team of professional American lawyers to attend the hearing.

Andrew Shayer said that Chinese canned oranges are irreplaceable in the US market. In 2017, the United States imported more than 160,000 tons of canned tangerines from China, with a total value of between 180 million and 200 million US dollars, accounting for about 95% of all canned tangerines consumed in the United States. Spain, the second largest exporter, is unlikely to transfer large quantities of products from the European Union to the United States, nor does a US company have sufficient capacity to supply such large quantities of canned tangerines to meet the needs of American consumers. "If the US government imposes a 25% tariff, which is equivalent to an increase of $350 per ton of canned tangerine, the total cost will increase by $50 million. Adding tariffs will increase the burden on US importers and consumers."

In fact, canned tangerine is only one of many “listed” agricultural products. In the total amount of 6031 US dollars imported from China, the United States intends to impose tariffs with 1,170 agricultural product tax numbers. The traditional industry has been labeled as the so-called "infringement of intellectual property rights" and has led to many products on the list, which has made many Chinese and American agricultural products practitioners feel helpless.

"The US government intends to impose a unilateral trade restriction on tariffs of 200 billion US dollars on Chinese exports to the United States, violating WTO rules and undermining the world trade order." Yu Lu, the vice president of the China Chamber of Commerce for Import and Export of Food, Livestock and Animals, who attended the hearing. Said in the speech. She pointed out that from 1998 to 2017, the total trade volume of Sino-US agricultural products increased from 2.7 billion US dollars to 31.7 billion US dollars. In 2017, China’s agricultural trade deficit with the United States exceeded $16.4 billion. At present, China is the largest export market for agricultural products in the United States and the largest market for bulk commodities such as US soybeans. 62% of the US soybeans are exported to China. "The stable development of Sino-US agricultural trade has benefited farmers and consumers in both countries." The agricultural products in the US tariff list of 200 billion US dollars of Chinese products accounted for 80% of the total export value of the sector. This proposed tariff list will greatly impact the US agricultural product market, increase the consumption cost of American consumers, and cause damage to enterprises and employment related to agricultural products processing trade.

After the meeting, Yu Lu told reporters that “the hearings have been carried out until now, many American agricultural products companies and industry associations have expressed their views against the increase of tariffs. The China Food, Animal, and Animal Import and Export Chamber of Commerce has more than 7,000 members, hope In this way, the US side will be informed of the Chinese side's opinions and will allow the US to delete the relevant agricultural product tax number. After all, maintaining a healthy and stable Sino-US economic and trade relationship is in the interest of both parties."

"Adding tariffs on Chinese goods will greatly affect various industries in the United States."

“The tariff policy is forcing our company to reassess the risk of investing in a new plant in Louisiana,” said James Newport, general manager of Wanhua Chemical America Holdings Ltd.

Wanhua Chemical Group Co., Ltd. is a Chinese chemical company and an industry leader in the chemical material diphenylmethane diisocyanate (MDI) with more than 13,000 employees worldwide. Currently, R&D centers and sales offices have been established in the United States. The company announced last year that it plans to invest $1.2 billion in a new plant in Louisiana, which is expected to create more than 1,200 jobs in the region. However, with the US government announcing tariffs on imported steel and aluminum products, and including aniline and other related chemical products in the $200 billion product taxation list, the investment cost of Wanhua Chemical's construction of a new plant in Louisiana will increase. Ten million dollars, this investment plan faces huge economic risks.

MDI is widely used as a main component of spray foam insulation for residential and commercial buildings. It is also the main raw material for sheet and insulation panels, and is also used for refrigeration insulation materials. At present, Wanhua Chemical has a 15% share of the US MDI market, and the demand for MDI in the US market is still growing. Wanhua Chemical plans to build a plant in Louisiana that has been approved to produce MDI licenses in the US to reduce imports of materials from China, which will help reduce the US-China trade deficit.

James Newport said that Wanhua Chemical's investment plan depends on whether it has achieved good MDI sales in the US market, and as the cost of importing MDI from China increases, downstream users will face higher prices and material supply shortages. Small businesses and consumers will suffer as a result. In addition, the US government imposes tariffs on such products, which may also force US MDI customers to consider moving their production facilities to other nearby countries, such as Canada and Mexico, where import tariffs on MDI and aniline are low or absent.

"The deepest feeling of attending the hearings these days is that the tariff on Chinese goods will greatly affect the domestic industry. Whether it is a large enterprise of tens of thousands of people or a small family business, the dependence on Chinese products is Very high, they can't find suitable suppliers in other countries in the short term." Zhu Haicheng, a lawyer at Zhejiang Qianxun Law Firm who spoke at the hearing on the 22nd, told this reporter that the process of deleting the tax number is very opaque. Relevant Chinese companies should cooperate with US importers to deal with the countermeasures. Whether from a commercial or legal perspective, it is necessary to make a variety of preparations.

"We have an obligation to point out in person the wrong behavior of the US government."

Tan Jian, the head of the Legal Services Department of the China International Chamber of Commerce, has come to Washington for the third time to participate in the 301 investigation hearing. "Compared with the previous products of 34 billion US dollars and 16 billion US dollars, the tariffs on China's exports to the US for 200 billion US dollars will cause greater damage to the interests of the United States and the international community. The China International Trade Commission does not agree with the US government on these products. Additional tariffs are imposed.” Tan Jian said in his speech that increasing tariffs would harm US companies trying to optimize global resource allocation and US consumers who purchase cost-effective Chinese products, including millions of low-income families. "China and the United States should resolve their differences through negotiations."

After the meeting, Tan Jian told this reporter that "this time the Chinese companies have increased a lot more than in the past. On the one hand, the scope of the proposed taxation in the United States is even greater. Another reason is that Chinese companies realize that this is An important opportunity to express their opinions to the US.” Tan Jian told this reporter that “it is important to deal with international trade barriers, that is, to make your products or services to the extreme and become irreplaceable.”

Yi Bo, an associate professor at Southeast University Law School, also participated in the US 301 investigation hearing for the third time. In his testimony, he explained the legitimacy and legitimacy of China's trade counter-measure against the United States. He told this reporter that the United States launched the 301 investigation to put its domestic laws above international law. "We have an obligation to point out the wrong behavior of the US government in person and propose that WTO rules are still important for regulating Sino-US trade." .

(People’s Daily, Washington, August 23rd)



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