Today's Paper Latest Coronavirus 🔴Children in Peril Quarantine Families Core values App Listen Story ideas iPad Weather Newsletters Obits Puzzles Archive
story.lead_photo.caption FILE - In this March 6, 2019, file photo a staff member works on a mobile phone production line during a media tour in Huawei factory in Dongguan, China's Guangdong province. Huawei Technologies Co. is one of the world's biggest supplier of telecommunications equipment. The United States is delaying tariffs on Chinese-made cellphones, laptop computers and other items and removing other Chinese imports from its target list altogether in a move that triggered a rally on Wall Street. (AP Photo/Kin Cheung, File)

President Donald Trump's administration Tuesday narrowed the list of Chinese products on which it plans to impose new tariffs as of Sept. 1, delaying levies on cellphones, laptop computers, toys and other goods for more than three months to spare shoppers from higher prices during the back-to-school and Christmas seasons. Stocks soared on the news.

The move pushed a new 10% tariff on some goods until Dec. 15 and excluded others entirely.

Trump's earlier tariffs on Chinese imports were carefully crafted to hit businesses in ways that consumers would mostly not notice. But his announcement this month of the 10% tariff on $300 billion of Chinese goods meant shoppers would soon feel the trade war's sting more directly.

On Tuesday, Trump acknowledged as much.

[Video not showing up above? Click here to watch »]

"We're doing this for the Christmas season," he told reporters. "Just in case some of the tariffs would have an impact on U.S. customers."

Trump said his administration had a "very productive" call with China and that he thinks Beijing wants to "do something dramatic" on trade.

"They really would like to make a deal," Trump said Tuesday before boarding a helicopter in Morristown, N.J.

Liu He, China's vice premier and lead trade negotiator, spoke with Robert Lighthizer, the U.S. trade representative, and Steven Mnuchin, the Treasury secretary, on Tuesday, and the three agreed to speak again in two weeks, the state-run Xinhua News Agency reported.

Trump has been pressing Beijing since last year to make a trade deal that would, among other things, strengthen protections for U.S. intellectual property, open Chinese markets to U.S. business, and result in China buying large quantities of U.S. energy and agricultural goods.

But negotiators have made little progress since May, when progress stalled over several issues. The stumbling blocks include whether Trump would roll back the 25% tariffs the administration has already imposed on roughly $250 billion of Chinese goods and whether Beijing would enshrine in law the changes it has pledged to make.

The president's comments Tuesday about the tariffs' effect on consumers followed an announcement by the U.S. trade representative's office that while the new tariffs would take effect as Trump had threatened, some notable items would not immediately be subject to them.

Consumer electronics, video game consoles, some toys, computer monitors and some footwear and clothing items were among the items the trade representative's office said would not be hit with tariffs until retailers had time to stockpile what they needed for their busiest time of year.

"What this means is that retailers will be able to get their shipments in without the 10% tariff, which is a sigh of relief," said Poonam Goyal, a retail analyst at Bloomberg Intelligence. "It definitely saves the holiday season."

With the Sept. 1 deadline, there wasn't time for retailers to speed up ordering for the Christmas season because it often takes more than four weeks for inventory to come from China, Goyal said.

The administration also said some products were being removed from the tariff list altogether "based on health, safety, national security and other factors." A spokesman for the trade representative's office said the products being excluded from the tariffs included child car seats, shipping containers, cranes, certain fish, and Bibles and other religious literature.

Stocks surged on the news. The S&P 500 index rose 1.48%, recovering from a 1.2% drop Monday.

The Dow Jones industrial average rose about 1.44%, while the tech-heavy Nasdaq Composite, which houses a great deal of U.S. companies with exposure to China, closed up 1.95%. Apple, Intel, Cisco and Microsoft were among the biggest gainers, showing how much the technology sector is tied to the China economy.

Earlier Tuesday, Trump had criticized China for not making large purchases of U.S. farm goods, suggesting that the tariffs might force them into action.

"As usual, China said they were going to be buying 'big' from our great American Farmers," he wrote on Twitter. "So far they have not done what they said. Maybe this will be different!"

David French, a spokesman for the National Retail Federation, said the organization was pleased by the delay of levies on certain consumer goods but expressed caution.

"Continued uncertainty for U.S. businesses and consumers is a drag on the economy," he said. "What we really need is an effective strategy to address China's unfair trade practices by working with our allies instead of using unilateral tariffs that cost American jobs and hurt consumers."

While markets applauded the splitting of the new tariffs, the sudden turnaround also means that some businesses are once again being left to make important business decisions on the fly because of the president's trade policies.

"It's too late and it's not enough," said Peter Bragdon, chief administrative officer for the Columbia Sportswear Co. "There's continued chaotic policy making and incoherence coming out of Washington that makes it very hard for businesses in the United States to plan."

Columbia still has products including footwear such as waterproof hiking boots that would be hit with a 10% tariff come next month. While only 10%-15% of Columbia's products were made in China, production of specialized footwear was difficult to move, Bragdon said, and the company had already warned customers that it would be forced to raise some of its prices.

In some cases the splitting of the tariffs will make life more complicated for retailers and other businesses. Some categories of golf shoes, for example, will be subject to a 10% tariff Sept. 1 while others will not be targeted until Dec. 15. Apple Inc.'s iPhones will not face new import taxes until mid-December. But the popular wireless AirPods that go with them will be taxed in September.

"It shows the increasing chaos of the administration's trade strategy toward China. And despite the president's claims, it's the clearest sign yet that Trump actually does understand that the tariffs are hurting American companies and consumers," said Edward Alden, a trade expert at the Council on Foreign Relations. "It will also further weaken the already slim chances for any negotiating progress in September. Why would the Chinese make difficult decisions if they can wait out Trump and wait for him to fold when the stock market sags?"

Jay Foreman, CEO of the toy company Basic Fun, said he's pleased that the 10% tariffs have been delayed for products like his until December. His company, based in Boca Raton, Fla., had already set prices for the Christmas season and would have had to absorb the impact of the tariffs. Foreman said he is considering layoffs this fall to offset his higher costs and noted that despite Trump's reprieve, tariffs remain a severe threat.

"We were relieved," he said. "But does that stop the volatility and instability? No."

Information for this article was contributed by Ana Swanson of The New York Times; by Taylor Telford and Thomas Heath of The Washington Post; by Jenny Leonard, Shawn Donnan, Olivia Rockeman, Jonathan Roeder, Jordyn Holman, Joe Deaux, Justin Sink and Sarah McGregor of Bloomberg News; and by Paul Wiseman, Christopher Rugaber, Anne D'Innocenzio and Larry Fenn of The Associated Press.

A Section on 08/14/2019

Print Headline: Trump dials back new tariffs; some levies on China items delayed until nearly Christmas


Sponsor Content

Archived Comments

  • RBear
    August 14, 2019 at 6:40 a.m.

    So either Trump finally understands what his tariffs are doing to the US economy or enough of his advisers sat him down and told the emperor he had no clothes on. Regardless, this just shows how out of touch Trump is with the economy of the country he's supposed to be leading. Signs were also coming in that prior tariffs were starting to impact consumer goods through indirect costs which do take some time to filter through. Once again, something most people with business smarts have, but apparently something the president doesn't have a clue about.
    But what will also happen is that China and its manufacturers will adjust their business models to be ready for the tariffs in December, IF they ever come. Any move China and the manufacturers make will be strategic such as diversifying manufacturing footprints or increasing automation. I doubt you'll see much reshoring of manufacturing to the US as we are not equipped for that. Trump COULD have made more headway on that if his administration had been more prepared. But the tax cut which was supposed to provide some assistance for that has done very little.
    Looking at trade friendly countries like Japan, Trump's rhetoric doesn't make with reality. From an article today in the NY Times (once again, ahead of this paper), "At a summit meeting in June, Prime Minister Shinzo Abe of Japan handed Mr. Trump a chart showing Japanese investments in the United States that would yield just under 22,000 new jobs. While Mr. Trump hailed the figures, Commerce Department data show that the rate of Japanese investment growth in the United States has slowed under Mr. Trump, compared with Mr. Obama’s second term."
    While administration officials had hoped the tax cuts would result in greater investment in the US, they have turned out to be anemic on that front. Most have been focused on buy backs of stock according to data from the Federal Reserve. The administration is trying to paint a rosy picture on this by saying those selling stocks will invest the proceeds in things like startups, but there has been no sign of those type of moves.

    August 14, 2019 at 6:49 a.m.

    And once again MAGA caps will be exempt.

  • RBear
    August 14, 2019 at 8:19 a.m.

    As well as bibles. You'd think they'd want the Word of God printed with "Made in the USA" on them.

  • 3WorldState1
    August 14, 2019 at 9:28 a.m.

    Trump said yesterday when taking about postponing additional tariffs, “and if these tariffs are being paid by people...”
    I just can’t understand how people will allow themselves to be lied to over and over again. I could understand if it was their long term priest or best friend or something, but Donald Trump? The biggest lyingest pos, draft dodging, sex paying adulterer trust fund baby? I just don’t get it. The shallowness of the gop base is just unbelievable.

  • RBolt
    August 14, 2019 at 11:52 a.m.

    Nothing really matters unless it impacts the bottom line of the wealthy.

  • Illinoisroy
    August 14, 2019 at 12:07 p.m.

    apparently he has had too much winning!

  • mrcharles
    August 14, 2019 at 3:50 p.m.

    Refreshing to see the admitting that the thing in Washington lied to us about who is being hurt by tariffs. But of course with christimas coming up and the war on christmas taking a majority of the good will away from christmas, this action will enable fox to concentrate on this terrible matter that haunts america. After all the bottom line, the eyes bright of children, and mass quantities of christmas cheer [ me, I like hot dr pepper and rum] is a thing to behold.

    Yes sir a mighty fine POTUS that understands his insanity hurts those who love him the most, and in that regard wants to back track on his sound policy of not knowing WTF is going on , to once again confound reason and common sense.

    Ever have a confederate flag made in china? What's up with that?

    As a famous movie character once said, is you or is you not my constituents ?