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Trump’s Trade Tariffs Target Ambitious Chinese Plan To Dominate Strategic Industries

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by Ryan Pickrell

The U.S. is taking aim at a major Chinese development plan in response to the alleged theft of American intellectual property and forced technology transfer.

The Office of the U.S. Trade Representative released a list Tuesday of around 1,300 Chinese products subject to punitive tariffs of roughly 25 percent. The proposed trade penalties are expected to come at about $50 billion for the Chinese. “This level is appropriate in light of the estimated harm to the U.S. economy,” the USTR explained, adding the goal is the “elimination of China’s harmful acts, policies and practices.”

“The total value of imports subject to the tariff increase is commensurate with an economic analysis of the harm caused by China’s unreasonable technology transfer policies to the US economy, as covered by USTR’s Section 301 investigation,” the relevant report stated.

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When selecting Chinese products, government trade analysts focused on “products that benefit from Chinese industrial policies, including Made in China 2025” while striving to reduce the impact on Americans. The Made in China 2025 strategy is an ambitious state plan to ensure Chinese domination in emerging industries of particular importance, such as advanced robotics and aerospace technology. The goods on the USTR’s list include Chinese electronics, machinery and equipment, health care goods, and a number of other products.

The major Made in China 2025 strategy was announced two years ago and enjoys tremendous state support, which led to complaints state subsidies and beneficial government policies give Chinese companies an unfair advantage in global markets.

The trade penalties target products and technology that advance Beijing’s industrial development goals, punishing China for advancing its interests at the expense of other countries. The tariffs have yet to go into effect, while China is already threatening to retaliate against American products, escalating a trade war many have long feared would come.

“As the Chinese saying goes, it is only polite to reciprocate,” the Chinese Embassy in Washington, D.C., said in a statement, adding Beijing will take “corresponding measures of equal scale and strength against U.S. products.”

The embassy “strongly condemns and firmly opposes the unfounded Section 301 investigation and the proposed list of products and tariff increases based on the investigation,” it said. “It serves neither China’s interest nor U.S. interest, even less the interest of the global economy,” the embassy added.

China and the U.S. have already begun trading barbs over the tough steel and aluminum tariffs President Donald Trump announced in early March. The latest move is expected to increase tension in the bilateral U.S.-China relationship.

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