A trade war may escalate between the United States and China as President Trump uses the threat of increased taxes to fight intellectual property theft in a country that doesn’t have much respect for copyrights.
Trump’s plan would impose 25 percent tariffs on $50 billion worth of Chinese imports, with 800 products worth some $45 billion becoming affected on July 6.
China has pledged to retaliate, and, in turn, Trump has pledged to impose sterner tariffs. The president called the tariffs “essential to preventing further unfair transfers of American technology and intellectual property to China, which will protect American jobs.”
China is known for playing hardball with its pay-to-play schemes, including requiring foreign firms to share ownership with local partners to gain access to the Chinese market. The U.S. is trying to stop these methods that require transferring intellectual property of Americans to Chinese companies.
The plan has certainly gotten a mixed response. U.S. Chamber of Commerce President and CEO Thomas J. Donohue recently issued a statement that said while the Chamber supported the Trump administration’s efforts to deal with China’s unfair trade practices, “we continue to believe that the use of tariffs puts all the burden on American companies and consumers.”
Donohue called the tariffs a de facto tax on American consumers that “will undermine the competitiveness of American companies, just as the administration’s steel tariffs have dramatically raised prices on steel in the United States.”
Democratic Sen. Chuck Schumer, meanwhile, said Trump’s plan “is right on target.”
“China is our real trade enemy, and their theft of intellectual property and their refusal to let our companies compete fairly threatens millions of future American jobs,” he said.
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