Yesterday, President Trump slapped tariffs on two of its biggest trading partners, Korea and China, with new charges on washing machines and solar cells in his first major trade “deal”.
The U.S. will impose new duties of as much as 30 percent on foreign-made solar equipment, the U.S. Trade Representative’s office said Monday. The president, who took office a year ago, also approved tariffs starting as high as 50 percent on imported washing machines, according to USTR.
The new tariffs will add teeth to the president’s “America First” foreign policy after months of threatening to get tough on what Trump sees as the unfair trade practices of nations such as China and South Korea.
“The president’s action makes clear again that the Trump administration will always defend American workers, farmers, ranchers and businesses in this regard,” U.S. Trade Representative Robert Lighthizer said in a statement.
Curious. Most conservatives are usually anti-immigration, but pro-trade. It’s in their DNA: protect the homeland from the strange “others” , but spread the wealth by swapping goods with those strangers to benefit both (theoretically).
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Trump peddles a rabid form of conservatism that is racially motivated anti-immigration and now wholly protective of the homeland, regardless of the financial impact.
And therein lies the problem – the burgeoning solar industry in the US relies upon cheaper solar panels from Asia:
The Solar Energy Industries Association said the decision would lead to the loss of up to 23,000 US jobs this year and result in the delay or cancellation of billions of dollars in investment in solar projects.
The first 2.5 gigawatts of solar cell imports will not be subject to tariffs while the first 1.2m washing machines imported will face a lower 20 per cent tariff in the first year. But the allowed quota of 2.5GW per year of tariff-free panels is significantly smaller than the size of the US market. There were about 3.5GW of small-scale solar capacity alone installed in the US last year, along with about twice as much again in large-scale plants.
This opening shot in a potentially wider trade war calls into attention the motivation of Trump, given that his own Republican Party is against the solar tariffs. The main corporation behind the calling of the tariffs is a failed entity called Suniva, which just happens to be majority-owned by Chinese investors.
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It screams of back door deals that benefit Trump and his financial allies and not MAGA, and of course doubles down on Trump’s anti-science reaction to climate change and renewable energy.
The Chinese are not happy:
The Chinese Commerce Ministry on Tuesday expressed “strong dissatisfaction” over the move, saying it “aggravates the global trade environment.”
The Chinese Commerce Ministry called the U.S. process that led to the tariffs “an abuse” of the trade measures available to the Trump administration. In its investigations, the U.S. International Trade Commission determined that imports of solar panels and washers had hurt American companies.
“China hopes the U.S. will exercise restraint in using trade restrictions,” the ministry said in a statement, warning that it will “resolutely defend its legitimate interests.”
Neither is South Korea:
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South Korean Trade Minister Kim Hyun-chong called Trump’s decision “excessive and a clear violation” of World Trade Organization rules.
South Korea plans to file a complaint with the WTO over the move to impose tariffs, Kim said at a meeting with industry officials.
“The U.S. opted for a measure that puts the domestic political situation above international rules,” he said.
Meanwhile, NAFTA is tearing at the seams, with Mexico upset about the tariffs and the Canadians going their own way on the TPP:
Canadian Prime Minister Justin Trudeau says Canada and the remaining 11 countries of the Trans-Pacific Partnership have agreed to a revised trade agreement. The deal comes exactly one year after U.S. President Donald Trump withdrew his country from the agreement.
The agreement follows two days of high-level talks in Tokyo and was confirmed by Canadian International Trade Minister Francois-Philippe Champagne. The partners are now expected to work toward signing the agreement by early March
