More sparring this week in the trade war has brought some positive developments. These positive moves are timely as a new round of trade talks between U.S. and Chinese negotiators is set to begin later this month. This new round of talks is in anticipation of further high-level meetings expected to take place in October.
First, China as made a further conciliatory move by removing certain products from the list of retaliatory tariffs announced after the Trump administration had stated its intention to increase tariffs on $250 million of Chinese imports. The new U.S. tariffs (on goods listed on lists 1-3) were scheduled to move from 25% to 30% on October 1st. The Chines tariffs on U.S. goods have now exempted 16 items imported from the U.S.
On Wednesday the U.S. announced that the October 1st increases have now been deferred until October 15th. This is viewed by many as a hopeful sign that both parties are willing to de-escalate the ongoing tit-for-tat tariff increases we have seen for the last year and a half.
These tariff issues are now quite complex since there have been different levels set at different times on different lists of products. Keep in mind the more recent tariffs of 10% on $260 billion of Chines imports are still in line for increases from 10% to 15%, some of which became effective September 1st and others still scheduled for December 15th.
We hope the positive momentum of this week's concessions will continue to be seen in talks over the coming weeks. We will continue to update our systems to account for these changes, monitor the evolving talks and announcements, and keep you advised.