How’s this for a strained sports analogy? The Section 301 heavyweight match to determine the undisputed trade war championship of the world is now in Round 4, with neither contender showing any sign of slowing down. Since the typical boxing match is scheduled for twelve rounds, let’s all hope my analogy turns out to be a poor one, and the festivities end much sooner without a knockout or TKO.
Rounds 1 and 2 were the imposition of a 25 percent tariff on imports from China valued at $34 billion and the proposal to do the same to an additional $16 billion in imports. After China hit back with higher duties on imports from the United States, the Trade Representative identified another 6,031 Harmonized Tariff Schedule subheadings as candidates for an additional tariff of 10 percent. The value of Chinese imports under these provisions is $200 billion.
That’s Gonna Leave a Mark
The bell just rang for Round 4. USTR landed a right hook by proposing to increase the Round 3 tariff rate to 25 percent, as additional punishment for China’s initial counter-retaliation. China immediately counter-punched by identifying an additional $60 billion in U.S. imports to pummel with new tariffs ranging from 5 to 25 percent.
USTR now seeks public comment on the proposed 25 percent tariff and will hold a hearing. The new schedule, which supersedes that originally in place to address the 10 percent Round 3 tariffs, is:
August 13, 2018: Deadline for submission of requests to appear at the hearing, summaries of expected testimony and pre-hearing submissions (extended from July 27).
September 5, 2018: Deadline for submission of written comments (extended from
August 20-23, 2018: Hearing (date unchanged).
September 5, 2018: Deadline for submission of post-hearing rebuttal comments (extended from August 30).
Will the United States and China run out of tariff subheadings to hit before they go the distance, or perhaps be saved by the bell before either takes a dive? Is this whole thing just a feint? Will I run out of clichéd boxing references before it’s all over? Stay tuned for the answers.