The Trump administration this week will unveil a list of advanced technology Chinese imports targeted for US tariffs to punish Beijing over technology transfer policies, a move expected to intensify trade tensions between the world's two largest economies.
US tariffs on $US50 billion (NZ$59b) to $US60 billion (NZ$83b) worth of annual imports is expected to be levied on products benefiting from Beijing's "Made in China 2025" industrial development program, but it may be more than two months before the import curbs take effect, administration officials have said.
The US Trade Representative's office needs to unveil the list of products by Friday under President Donald Trump's China tariff proclamation signed on March 22.
The tariffs are aimed at forcing changes to Chinese government policies that the United States Trade Representative (USTR) says results in the "uneconomic" transfer of US intellectual property to Chinese companies.
The agency's "Section 301" investigation authorising the tariffs alleges China has systematically sought to misappropriate US intellectual property through joint-venture requirements, unfair technology licensing rules, purchases of US technology firms with state funding and outright theft.
China has denied that its laws require technology transfers and has threatened to retaliate against any US tariffs with trade sanctions of its own, with potential targets such as US soybeans, aircraft or heavy equipment.
On Sunday, Beijing slapped extra tariffs of up to 25 percent on 128 US products including frozen pork, as well as wine and certain fruits and nuts in response to steep US tariffs on imports of aluminium and steel announced last month by the Trump administration.
Fears have arisen that the two countries will spiral into a trade war that will crush global growth.
Senior Economics Lecturer at Auckland University, Dr Asha Sundaram, said New Zealand is at risk because it’s a small, open economy that relies on exports.
“With the U.S. and China going into a trade war there’s the possibility other countries might retaliate with tariffs of their own. Also, this could dampen global demand because prices all over are going to go up”, Dr Sundaram said.
White House trade adviser Peter Navarro said last week that Section 301 tariffs would focus on Chinese industries benefiting from the Made in China 2025 plan, which aims to replace advanced technology imports with domestic products.
"China in my view brazenly has released this China 2025 plan and basically told the rest of the world, 'We're going to dominate every single emerging industry of the future and therefore your economies aren't going to have any future'," Mr Navarro told Bloomberg Television.
"The Section 301, which is on intellectual theft and forced transfer, is specifically designed to address those kinds of things," Mr Navarro said.
The state-led 2025 program targets 10 strategic industries: advanced information technology, robotics, aircraft, shipbuilding and marine engineering, advanced rail equipment, new energy vehicles, electrical generation equipment, agricultural machinery, pharmaceuticals and advanced materials.
"Foreign technology acquisition through various means remains a prime focus under Made in China 2025 because China is still catching up in many of the areas prioritised for development," USTR said in its report justifying the tariffs.
US Trade Representative Robert Lighthizer has said that preserving America's technological edge is "the future of the US economy".
Reuters/ Newshub
