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United States President Donald Trump is preparing to impose a package of $60 billion in annual tariffs against China, following through on a long-time threat, which according to him will punish China for intellectual property infringement and help create more American jobs.
The tariff package, which Trump plans to unveil by Friday, was confirmed by four senior administration officials.
According to The Washington Post, senior aides had presented Trump with a $30 billion tariff package that would apply to a range of products.
But Trump directed them to roughly double the scope of the new trade levies.
The package could be applied to more than 100 products, which Trump argued were developed by using trade secrets the Chinese stole from the US companies or forced them to hand over in exchange for market access.
It is interesting to note that China is also the largest foreign holder of the US government debt.
It holds $1.17 trillion of US Treasury securities, down about $33.5 billion since August last year.
The Treasury faces huge borrowing needs, not only to finance new deficits but also to refinance past securities coming due, so a drop in China's appetite for that debt could nudge interest rates up in the United States.
If implemented, the tariff package could draw retaliation from China, further fraying the trade partnership between two of the world's largest economies.
But experts also noted that China would not want to hurt the value of the huge amount of securities it still holds, leaving the two nations' finances somewhat mutually dependent.
