Share This Article

Facebook LinkedIn
Twitter Reddit
Print Email
Pinterest Gmail
Yahoo
Money Morning
×
  • Invest
    • Best Stocks to Buy
    • Stock Forecasts
    • Stocks to Sell Now
    • Stock Market Predictions
    • Technology Stocks
    • Best REITs to Buy Now
    • IPO Stocks
    • Penny Stocks
    • Dividend Stocks
    • Cryptocurrencies
    • Cannabis Investing
    • AI Investing
  • Trade
    • How to Trade Options
    • Best Trades to Make Now
    • Options Trading Strategies
    • Weekly Trade Recommendations
  • Retire
    • Income Investing Guide
    • Retirement Articles
  • More
    • Money Morning LIVE
    • Special Investing Reports
    • Our ELetters
    • Our Premium Services
    • Videos
    • Meet Our Experts
    • Profit Academy
    • Postcards
Login Archives Your Team About Us FAQ
  • Invest
    • Best Stocks to Buy
    • Stock Forecasts
    • Stocks to Sell Now
    • Stock Market Predictions
    • Technology Stocks
    • Best REITs to Buy Now
    • IPO Stocks
    • Penny Stocks
    • Dividend Stocks
    • Cryptocurrencies
    • Cannabis Investing
    • AI Investing
    ×
  • Trade
    • How to Trade Options
    • Best Trades to Make Now
    • Options Trading Strategies
    • Weekly Trade Recommendations
    ×
  • Retire
    • Income Investing Guide
    • Retirement Articles
    ×
  • More
    • Money Morning LIVE
    • Special Investing Reports
    • Our ELetters
    • Our Premium Services
    • Videos
    • Meet Our Experts
    • Profit Academy
    • Postcards
    ×
  • Subscribe
Enter stock ticker or keyword
×
Join 100,000+ Like-Minded Investors Today
Twitter
Tags: China, Global Trade, Jason Simpkins, Steel, Trade, USITC

U.S. Trade Spat with China Escalates, But is Unlikely to Cause a Significant Rift

By , Money Morning • September 14, 2009

View Comments

Start the conversation

Leave a Reply Click here to cancel reply.

You must be logged in to post a comment.

Shortly after U.S. President Barack Obama announced hefty import duties on Chinese-made tires, China's Ministry of Commerce over the weekend said it would explore possible sanctions against U.S. automobile and chicken imports.

The dispute has caused some concern over an escalation in protectionist measures between the two nations, but few analysts believe the dispute will spiral out of control and threaten a global recovery.

President Obama on Friday signed an order that imposes a 35% tariff on tires imported from China on top of the existing 4% duty. The order came mainly at the behest of the United Steelworkers union, which says 5,000 union jobs have been lost since 2004 because low-cost Chinese tires flooding the market. From 2004 to 2008, the number of tire imports from China has tripled.

The United States International Trade Commission (USITC) - the agency that counsels the president and Congress on trade - recommended even heavier sanctions against the tire imports. The ITC suggested a sliding tariff that would have started at 55% in the first year and then fallen to 45% next year and 35% the year after that. The duty enacted by Obama starts at the ITC's recommended low point of 35% before dropping to 30% and then 25% in the subsequent two years.

Steel companies United States Steel Corp. (NYSE: X) and Nucor Corp. (NYSE: NUE), as well as trade organizations like the National Farmers Union, National Cotton Council, and the American Corn Growers Association lauded Obama's decision, as they continue to argue that low-priced Chinese goods are hurting American business.

However, other companies and trade groups who view China as a valuable export market fear Beijing will retaliate with higher import tariffs on U.S. goods. Those fears came a step closer to being realized Sunday night when China's Ministry of Commerce announced it would launch an anti-dumping investigation into auto parts and chicken products imported from the United States.

"Recently, the commerce ministry has received word from domestic industries indicating that [chicken and auto] products had entered our nation's markets via dumping, subsidies and other unfair trade means," the ministry said on its website, giving no details about the specific products.

The United States shipped about $800 million in automotive products and $376 million in chicken meat to China in the first seven months of the year, while in that time China exported $1.3 billion in tires to the United States according to data from Global Trade Information Services.

Still, this is just a miniscule fraction of the total trade between the two nations. Two-way trade between the United States and China totaled $194.7 billion in the first seven months of 2009, according to the U.S. Census Bureau.

"While there's friction, I suspect that the two nations will keep any disputes under control," David Cohen, an economist at Action Economics in Singapore told Bloomberg News. "They understand that they're increasingly dependent as trading partners."

Exports to the United States account for 6% of China's total economic output, The New York Times reported.

News and Related Story Links:

  • U.S. Census Bureau:
    Trade in Goods (Imports, Exports and Trade Balance) with China
  • Bloomberg News:
    China Probes 'Unfair Trade' in U.S. Chicken and Auto Products
  • The New York Times:
    China-U.S. Trade Dispute Has Broad Implications

Here Are 10 “One-Click” Ways to Earn 10% or Better on Your Money Every Quarter

Appreciation is great, but it’s possible to get even more out of the shares you own. A lot more: you can easily beat inflation and collect regular income to spare. There are no complicated trades to put on, no high-level options clearances necessary. In fact, you can do this with a couple of mouse clicks – passive income redefined. Click here for the report…

Claim My Free Report

Subscribe
Login
Notify of
guest

guest

4 Comments
Oldest
Newest Most Voted
Inline Feedbacks
View all comments
trackback
Here's Why the U.S.-China Tire Tiff Lead to Great Depression II
14 years ago

[…] States of blatant protectionism as part of a World Trade Organization (WTO) complaint. And China is also threatening to retaliate against imports of U.S. poultry and vehicles. This all sounds arcane, but it isn't. This escalating tiff over tire tariffs has the […]

0
Reply
trackback
Buy, Sell or Hold: Constellation Energy Group Inc. (NYSE: CEG) Has Long-Term Potential, But Short-Term Problems
13 years ago

[…] that destructive protectionism will affect the deal.  The Obama administration recently levied special import duties on Chinese tires.  When governments are forced to confront the tough realities of high unemployment, the […]

0
Reply
trackback
China Fuming Over the Latest U.S. Trade Complaint
13 years ago

[…] Money Morning: U.S. Trade Spat with China Escalates, But is Unlikely to Cause a Significant Rift […]

0
Reply
trackback
Buy, Sell or Hold: Constellation Energy Group Inc. (NYSE: CEG) Has Long-Term Potential, But Short-Term Problems
13 years ago

[…] that destructive protectionism will affect the deal.  The Obama administration recently levied special import duties on Chinese tires.  When governments are forced to confront the tough realities of high unemployment, the likelihood […]

0
Reply


Latest News

September 21, 2023 • By Shah Gilani

earnings
The Best Auto Stocks to Buy (or Avoid) Right Now

September 21, 2023 • By Garrett Baldwin

Postcards: Tell Your Wife These Three Little Words

September 20, 2023 • By Garrett Baldwin

Postcards: Captured by Vines... and Regulation
Trending Stories
ABOUT MONEY MORNING

Money Morning gives you access to a team of market experts with more than 250 years of combined investing experience – for free. Our experts – who have appeared on FOXBusiness, CNBC, NPR, and BloombergTV – deliver daily investing tips and stock picks, provide analysis with actions to take, and answer your biggest market questions. Our goal is to help our millions of e-newsletter subscribers and Moneymorning.com visitors become smarter, more confident investors.

QUICK LINKS
About Us COVID-19 Announcements How Money Morning Works FAQs Contact Us Search Article Archive Forgot Username/Password Archives Profit Academy Research Your Team Videos Text Messaging Terms of Use
FREE NEWSLETTERS
Total Wealth Research Power Profit Trades Penny Hawk Midday Momentum
PREMIUM SERVICES
Money Map Press Home Money Map Report Fast Fortune Club Weekly Cash Clock Microcurrency Trader Hyperdrive Portfolio Rocket Wealth Initiative Quantum Data Profits Flashpoint Trader Darknet Alpha Accelerators Brutus Alerts Resource Traders Alliance L.A.U.N.C.H. Investor Rob Roy Trader Long-Term Equity Profits

© 2023 Money Morning All Rights Reserved. Protected by copyright of the United States and international treaties. Any reproduction, copying, or redistribution (electronic or otherwise, including the world wide web), of content from this webpage, in whole or in part, is strictly prohibited without the express written permission of Money Morning.

Address: 1125 N Charles St. | Baltimore, MD, 21201 | USA | Phone: 888.384.8339 | Disclaimer | Sitemap | Privacy Policy | Whitelist Us | Do Not Sell or Share My Personal Information

wpDiscuz