Trump changed his mind about closing the US border with Mexico to stop the flow of illegal drugs and migrants, instead, he gave Mexico a ‘warning’ to fix the border, [Even the President’s strongest supporters are beginning to lose faith that any of his campaign promises will be kept in the long run.]
China: Commerce official Gao Feng said that US measures are essentially attacking global supply and value chains and that China will not bow down to threats and blackmail. US Customs and Border Protection officials are due to collect 25% duties on a range of products including motor vehicles, computer disk drives, parts of pumps, valves and printers and many other industrial components.
President Trump is following through on his threat to implement tariffs on $50 billion in Chinese imports, and China has vowed to retaliate. The tariffs are in response to an investigation that accused China of stealing US intellectual property in order to dominate the development of advanced technology. The US imported $505 billion of goods from China last year and exported about $130 billion, leaving a 2017 deficit of $376 billion.
President Trump is imposing a new 25% tariff on steel and a 10% tariff on aluminum imported from from Mexico, Canada, and the European Union. Mexico indicated it will retaliate against US agriculture products, Canada announced a new set of $16 billion in tariffs against US goods, and the EU will target bourbon and motorcycles made in the US. It is believed that China will be next on the list.
Trump is proposing 25% tariffs on 1300 Chinese imports which, if actually collected, would be $50 billion. This is said to be in retaliation for theft of intellectual property from US companies. If this proposal is implemented, part will be paid by Americans for higher prices for domestic products that use the imported materials. We expect that this proposal will not materialize as currently being discussed.