By Justin Pei
Rochester — China announced Thursday that it would slash its planned tariffs on $75 billion worth of U.S. goods, including automobiles, soybeans, and oil. Retaliatory tariffs will be reduced from 10% to 5% on some products, and 5% to 2.5% on others.
This is part of its efforts to implement the recently signed “Phase One” trade agreement with the United States.Under the phase-one trade agreement signed in December between the two countries, China agreed to tighten its intellectual-property rules as well as purchase up to $200 billion worth of U.S. goods over two years.
In return, the Trump administration agreed to reduce tariffs on $120 billion of Chinese goods, lowering the rate from 15% to 7.5% and postponing the implementation of new tariffs.
The Chinese Finance Ministry said in a statement that the tariff reduction was timed to correspond with those announced by the U.S., both of which were scheduled for February 14th. The Ministry of Finance also stated that it ultimately hopes to eliminate all tariff increases between the two countries in the future.
Global markets surged after the announcement. Mainland Chinese stocks rose as high as 2%, while Hong Kong’s rose nearly 3%. The Japanese stock market also jumped 2.38%. Additionally, stocks in the U.S. also gained following the announcement. The Dow was up 0.29%, the S&P by 0.28%, and the Nasdaq by 0.57%.
