Last August, the Trump administration began an investigation into Chinese government practices related to intellectual property protection and forced technology transfers. In the following April, the Office of the U.S. Trade Representative released the findings of its investigation. In a lengthy and scathing report, USTR laid out the case that Chinese government measures and practices result in American companies operating there being coerced into transferring their technology and intellectual property to domestic Chinese companies. The report claimed that those policies and practices supported Chinese government plans to dominate certain advanced technology sectors, including those laid out in the “Made in China 2025” industrial policy program.
As part of the investigation, the Trump administration estimated that Chin’s policies caused at least $50 billion in harm to the U.S. economy per year. President Trump in March announced that his administration would impose tariffs on Chinese imports of that value. After a notice and comment period, the U.S. imposed tariffs on $34 billion worth of Chinese products on July 6. Following another notice and comment period, the U.S. imposed additional tariffs on $16 billion worth of Chinese products, rounding out President Trump’s $50 billion order.
So far, China has responded with tariffs on an equivalent amount of U.S. goods. But the U.S.-China trade balance has made it impossible for China to keep up the tit-for-tat tariff exchange. In response to China’s retaliatory tariffs, President Trump has asked USTR to draft a list of Chinese products worth $200 billion that could be subject to tariffs. China responded by threatening additional tariffs on $60 billion worth of U.S. imports. President Trump fired back with a threat to impose tariffs on all Chinese imports, which would amount to added tariffs on roughly $300 billion of Chinese products.
|U.S.-China Trade Balance (millions, 2017)|
|Data: U.S. Census Bureau|
|Country||Tariffs Imposed||Tariffs Officially Under Consideration||Tariffs Threatened|
|U.S.||$50 billion||$200 billion||Roughly $300 billion|
|China||$50 billion||$60 billion|
The two countries have engaged in negotiations aimed at resolving their trade fight, but so far, those talks have not yielded a truce.