- U.S. tariffs on Chinese goods slated to take effect Dec. 15, known as list 4B, will not take effect, Donald Trump tweeted Friday morning, as the U.S. and China agreed to phase one of a trade deal. The Office of the U.S. Trade Representative (USTR) confirmed the deal in a press release shortly after.
- The 15% tariffs that took effect at the beginning of September on about $120 billion worth of goods (list 4A) will be reduced to a rate of 7.5%, according to the president and USTR. "The 25% Tariffs will remain as is," Trump tweeted, referring to lists one through three, totaling about $250 billion worth of imports from China.
- As part of the deal, USTR said China would make "substantial additional purchases of U.S. goods and services in the coming years" without specifying how much or what types of goods. Trump suggested the products would be agricultural, energy and manufacturing goods. "We will begin negotiations on the Phase Two Deal immediately," he said.
The cancellation of list 4B tariffs was highly anticipated, given its timing close to the holiday season and the large number of consumer goods the list targeted.
Still, the uncertainty drove businesses to continue planning for a worst-case scenario and adjust supply chains and imports accordingly.
Data from the National Retail Federation (NRF) and Hackett Associates showed a significant bump at container ports in November as retailers and manufacturers increased imports ahead of the anticipated tariffs. "While final numbers are not yet available, estimates indicate that November jumped to 1.95 million TEU, up 8 percent year-over-year," NRF wrote.
NRF and other industry organizations have long rallied against the list four tariffs and called for an end to the U.S.-China trade war.
While the trade war is far from over, as some level of tariff remains on $370 billion worth of imports from China, along with retaliatory tariffs on U.S. exports, the signing of phase one of a trade deal points to signs there may be an end in sight.