Trump to Issue New Tariffs on China: 301 Trade Violation Investigation Concludes

The Trump Administration is expected to announce Thursday an intent to impose tariffs on China for their well-documented and longstanding unfair trade practices. According to senior White House officials, the tariffs are designed to compensate the U.S. for the harm that China’s restrictive ownership requirements are imposing on American companies doing business there.

Trump is scheduled to sign a presidential memorandum “targeting China’s economic aggression” at 12:30 p.m. on Thursday.

White House officials speaking on background noted that the tariffs come following an extensive investigation conducted by U.S. Trade Representative (USTR) Robert Lighthizer that began last August under Section 301 of the Trade Act of 1974. The investigation was conducted after what officials said were years of known violations of free-market trading practices by China under both the George W. Bush and Barack Obama administrations.

One senior official called the new tariffs — the target value of which is approximately $50 billion to offset what the USTR and intra-agency report has calculated as the amount the U.S. has lost due to unfair Chinese trading practices — “historic”, and said President Donald Trump should be applauded for his courage and vision in addressing a problem previous administrations failed to take in hand.

According to the initial notice in August announcing the investigation, the USTR was determined to discover if China had been attempting to, most notably, require American companies wishing to do business there to give up a majority of ownership and reveal their technological innovations. The Chinese would then build on those innovations and dominate the market, putting American companies out of business.

The initiation follows upon President Trump’s Memorandum of August 14, 2017 instructing the U.S. Trade Representative to consider the possible initiation of an investigation. The President’s Memorandum emphasized that “the United States is a world leader in research-and-development-intensive, high-technology goods,” and that “violations of intellectual property rights and other unfair technology transfers potentially threaten United States firms by undermining their ability to compete fairly in the global market.”  The President’s Memorandum further noted that China’s conduct “may inhibit United States exports, deprive United States citizens of fair remuneration for their innovations, divert American jobs to workers in China, contribute to our trade deficit with China, and otherwise undermine American manufacturing, services, and innovation.”

According to White House officials, the USTR report has apparently found evidence that confirmed their suspicions.

Senior White House officials also estimated that the imbalanced trade situation has led to a loss over the years of roughly 2 million American jobs.

Lighthizer told the House of Representatives Ways and Means Committee that in addition to investigating trade violations, his report would seek to offer suggestions on ways to minimize the impact of new tariffs on U.S. consumers.