Update: President Trump will sign an executive memo that will enforce $50 billion in tariffs against China over IP theft, an administration officials tell reporters. The full list of tariffs will be published within 15 days, opening a 30 day public comment period before they take effect, so there is a 1 month grace period before the trade wars officially start.
According to the official, many of the proposals reflect areas where China has sought to acquire advantage through unfair acquisition or forced tech transfers from U.S. companies.
He added that Trump is also directing the U.S. trade representative to pursue dispute settlement at WTO in order to address China’s licensing practices, which U.S. says are discriminatory, and will also direct Treasury Dept to consider expanding limits on Chinese investment and acquisitions in U.S. beyond current CFIUS reach
Stocks briefly popped on the headlines as, supposedly, this pushed the start of the trade war off by 60 days.
* * *
President Trump will fire the first shots (retaliatory or not) in the new global trade war today as he announces plans to crack down on China with what is expected to be $50 billion in tariffs, controls on investment, and possible visa restrictions.
As we detailed previously, American officials have been raising their concerns about China’s IP practices since Bill Clinton was president, and Beijing has repeatedly failed to deliver on promises to reform, but now, as Bloomberg reports that the order will target more than 100 different types of Chinese goods, according to a person familiar with the matter, who spoke on the condition of anonymity.
The value of the tariffs was based on U.S. estimates of economic damage caused by intellectual-property theft by China.
This will be Trump’s first trade action directly aimed at China, which he has blamed for the hollowing out of the American manufacturing sector and the loss of U.S. jobs.
For decades, western companies have griped that Beijing is forcing them to hand over tech secrets and source code as a price of access to the Chinese market.
Now they have a White House prepared to act forcefully to stop it - starting tomorrow, Axios' Jonathan Swan reports - but the fear is a costly tit-for-tat trade war.
Live Feed (due to start at 1230ET...)
But China is drawing up a reprisal list that includes soybeans, sorghum and live hogs, report the WSJ's Lingling Wei, Yoko Kubota and Liza Lin.
Finally, as a reminder, China will begin trading its petroyuan futures contract next week (3/26) - so perhaps this action by Trump is a pre-emptive strike?
* * *
Hollywood version of today's events...