President Trump plans to raise tariffs on $200 billion worth of Chinese imports to 25 percent from 10 percent.
WASHINGTON — A pivotal round of trade talks between the United States and China gets underway on Thursday but American businesses are bracing for higher tariffs on Chinese imports as a quick resolution to resolve a yearlong trade war becomes increasingly unlikely.
Just a week ago, Wall Street and the nation’s largest industry lobbying groups were hopeful that the world’s two largest economies were on the cusp of securing a historic trade treaty. But President Trump’s anger at China for backtracking on big parts of an emerging deal has raised fears that the fragile negotiations are on the verge of collapse.
At a rally in Florida on Wednesday night, Mr. Trump vented that China reneged on its commitments.
“They broke the deal,” he said, adding that he was just as happy to punish China with tariffs.
Mr. Trump plans on Friday morning to raise tariffs on $200 billion worth of Chinese imports to 25 percent from 10 percent, including many consumer products that Americans rely on from Beijing, like seafood, luggage and electronics. The standoff is expected to raise prices for American companies and their customers across a large swath of sectors, potentially sending global stock markets falling.
The talks are due to resume around 5 p.m. at the offices of the United States Trade Representative.
Stock markets fell in the United States on Thursday morning, with the S&P 500 index down slightly more than 1 percent after trading began.
Despite Mr. Trump’s affinity for corporate America, its vocal concerns about the damage from the president’s trade war and tariffs have done little to change the White House’s approach.
“Clearly, we think a negotiating strategy based on tariffs is the wrong direction,” said David French, senior vice president of government relations at the National Retail Federation. “We’re certainly hopeful that the Chinese, when they come to Washington this week, come with a plan to make substantial concessions to avert this disaster.”
But Mr. Trump, already emboldened by a healthy American economy, may be encouraged to keep his trade war going given the monthly trade deficit with China fell in March to its lowest level since 2014 as China slowed its exports to America. The overall United States trade deficit with the world increased 1.5 percent in March to $50 billion, as it continued to import more goods and services than it exported worldwide.
Retailers wielded their influence successfully in 2017 when Republicans were considering a tax plan that they believed would have harmed their businesses. But when it comes to trade, Mr. French said that the Trump administration had been intransigent about their tariff concerns. To make its point, the retail association has been holding events featuring businesses that are suffering from tariffs in politically important states like Ohio.
