USTR to open hearings Tuesday on China tariffs

The Office of the US Trade Representative will hold public hearings on Tuesday and Wednesday over proposed tariffs on $16 billion worth of imported Chinese goods.

The announced tariffs are in response to China's trade practices related to technology transfer, intellectual property and innovation based on the findings in the USTR's investigation under Section 301 of the US Trade Act of 1974.

Of the 25 percent tariffs authorized for $50 billion of Chinese products, tariffs on $34 billion are in effect, and tariffs on the remaining $16 billion will be the subject of the public hearings.

Tariffs also are a contentious issue between the US and the European Union, and with European Commission President Jean-Claude Juncker traveling to Washington on Wednesday to discuss trade with US President Donald Trump, automobiles will be the focus.

Trump said he is prepared to impose a 20 to 25 percent tax on imported automobiles and auto parts if negotiations don't go well.

Europe has a 10 percent tariff on car imports, while the US has a 2.5 percent tariff on foreign cars. But the US also has a 25 percent tariff on light trucks (which includes SUVs).

Trump is talking about raising the tax on automobiles and auto parts to 20 or 25 percent.

"We said if we don't negotiate something fair, then we have tremendous retribution, which we don't want to use, but we have tremendous powers," Trump said ahead of the meeting. "Including cars — cars is the big one. And you know what we're talking about with respect to cars and tariffs on cars.

"They're coming in to see me Wednesday, and we'll see if we can work something out," Trump said at a White House event on Monday. "Otherwise, we'll have to do something with respect to the millions of cars that they send in every year. Maybe we can work something out."

"We will continue to react tit-for-tat to the provocations that might be thrown at us," Juncker said.

The Commerce Department is investigating whether auto industry imports threaten US national security.

"The tariffs under the guise of national security should be abolished," said Dieter Kempf, head of Germany's BDI industry association.

The German auto industry employed more than 118,000 Americans, and 60 percent of what they produced was exported, according to Kempf.

He called for talks on resolving trade disputes to take place at the World Trade Organization.

A group of US lawmakers held a "drive-in" rally with foreign automakers last week to protest the tariffs. The bipartisan group of 149 House members sent a letter to the Trump administration opposing new tariffs.

US Senators Lamar Alexander of Tennessee and Doug Jones of Alabama said they will release a bill next week that would stop the Commerce Department's investigation into the auto industry, which Trump needs to enact tariffs without congressional approval. Foreign automakers have several plants in both southern states.

"I believe the president would be in favor of no tariffs for anybody," Congressman Mark Meadows told Vox. "Obviously, I'm one that can see the strategic advantage of short-term tariff saber-rattling to get everybody to make sure we have fair trade."

A report by the National Automobile Dealers Association found that car prices could increase by $980 to $4,400 for consumers in the tariffs are enacted, and while the US would increase its own vehicle production, jobs would be at risk at car dealerships, vox.com reported.

Reuters contributed to this story.

Contact the writer at williamhennelly@chinadailyusa.com.