Human hair to rare earth metals – the items that won a reprieve as the US-China trade war expands
Revised tariff list reflects lobbying efforts of various American industries
While announcing fresh tariffs on US$200 billion worth of Chinese-made goods on Tuesday, the United States opted to remove an eclectic list of items it had originally targeted in July – ranging from smartwatches to rare earth minerals and human hair for wigs.
The revised list reflects the lobbying efforts various industries made to try and protect their products, ranging from technology giant Apple to Lighting Technologies International, a medium-sized California company that uses rare earth elements to make xenon lamps for digital cinema projectors.
US President Donald Trump threatened in July to impose tariffs on thousands of Chinese products as the US seeks to overcome a US$376 billion trade deficit between the countries, and to discourage what he says are unfair trade tactics used by the Chinese government.
Trump hits China with new US$200 billion tariff attack
With the latest list, the Trump Administration has targeted about half of all goods exported to the US from China, which sent US$505 billion in products to America last year.
The Chinese government said on Tuesday it would take “synchronised counter measures” in response to the US actions. It previously said it would add retaliatory tariffs on US$60 billion of American-made products. It may also cancel planned trade talks in Washington next week as a result of the latest move by Washington, according to a government source.
Lillian Li, vice-president credit strategy and standards at Moody’s Investors Service, said the new tariffs marked a “major escalation” in the US-China trade war, affecting about 6,000 products and a greater amount of consumer goods than past rounds. It could negatively affect China’s gross domestic product by 0.3 to 0.5 percentage points, she said.