China Cuts Some Tariffs

While U.S. trade policy under the Trump administration has become a confusing mix of bluster, posturing, threats, and uncertainty, China has gone in the other direction, at least incrementally by lowering some of its tariffs unilaterally.  On November 24, China’s Ministry of Financeannounced that it would cut tariffs on 187 consumer products. The lower duty rate took effect on December 1, so Chinese consumers are now benefitting from more competition and lower prices. As noted in the announcement, the average tariff on the covered products will be brought down from 17.3% to 7.3%.To give some specific examples, the tariff on cosmetics will be reduced from 10% to 5%; 30% to 10% for electronic toothbrushes; 32% to 10% for coffee makers; and 20% to 10% for mineral water. Baby formula and diapers will no longer face tariffs at all, dropping from 20% and 7.5%, respectively.Of course, China is far from perfect on trade policy. There is plenty of Chinese industrial policy and protectionism remaining. The World Trade Organization canprobably handle more of these trade practices than people think, but new rules may be necessary to deal with certain issues.Nevertheless, the tariff reduction is a positive development. Commentary on this policy changesuggests that the Chinese government ’s goal here was, in part, to satisfy the demand of Chinese consumers and to improve the efficiency of Chinese production by introducing foreign competitors. These days, it is nice to see any gover...
Source: Cato-at-liberty - Category: American Health Authors: Source Type: blogs