US vs. China: US Will Impose a Tariff on China-Made Tires
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This move of Obama will anger the US nation’s second largest trading partner.
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The decision is intended to boost up the US tire industry. With the triple growth in volume of Chinese tires in US market, US tire industry had lost more than 5000 jobs. And, it is also threatens to upset the trading relationship between US and China. On the other hand, world leaders are expected to discuss cooperation on trade issues on the summit.
The tariff will amount to 35% on the first year, 30% on the second, and 25% on the third. However, a federal trade panel had recommended higher levels like 55%, 45%, and 35% respectively.
The US congress pass the legislation in 2000 that allows the US to impose tariffs and other trade protections involving Chinese imports that will damage the US industry. China agreed to the provision while negotiating to join the World Trade Organization. The tire tariff takes effect on September 26.
