(Bloomberg) -- President Donald Trump plans to announce about $50 billion of tariffs against China as soon as Thursday over intellectual-property violations, according to people familiar with the matter.
The president is considering slapping tariffs on more than 100 different types of Chinese goods, according to a Trump administration official. The value of the tariffs was based on U.S. estimates of economic damage caused by intellectual-property theft by China, the person said.
The plan could be altered, and the timing is still fluid because of a snow storm that closed government offices in Washington on Wednesday, according to two other people who spoke on the condition of anonymity. The announcement will probably come after the U.S. market closes on Thursday afternoon, said fourth person familiar with matter.
Trump instructed U.S. Trade Representative Robert Lighthizer last year to investigate allegations that China steals U.S. intellectual property and forces American companies to transfer their technological know-how to Chinese firms as a condition of doing business in the Asian country.
Lighthizer confirmed Wednesday that the administration is considering both tariffs and curbs on Chinese investment, among other options. U.S. companies from Walmart Inc. to Amazon.com Inc. have warned that sweeping sanctions against China could raise consumer prices and hit the stock market.
"The president, I believe, is going to make a decision in the very near future on this issue,” U.S. Trade Representative Lighthizer told the House Ways and Means Committee Wednesday in Washington.
China is preparing to hit back at Trump’s planned sweeping tariffs with levies aimed at industries and states which tend to employ his supporters, the Wall Street Journal reported on Wednesday, citing unidentified people familiar with the matter.
“Our view is that we have a very serious problem of losing our intellectual property, which is really the biggest single advantage of the American economy,” Lighthizer told lawmakers. "We are losing that to China” in a way that doesn’t reflect economic fundamentals, he said.
Sweeping U.S. tariffs will test the resolve of Chinese President Xi Jinping, whose government has so far reacted in a measured fashion to Trump’s repeated complaints about the U.S.’srecord $375 billion deficit with China. The country’s foreign minister said earlier this month, in response to Trump’s decision to impose steel and aluminum tariffs, that China would have a “justified and necessary response” to any efforts to incite a trade war.
Chinese Premier Li Keqiang said on Tuesday that the nation will further open its economy, including the manufacturing sector, and pledged to lower import tariffs and cut taxes. In opening manufacturing further, China won’t force foreign companies to transfer technology to domestic ones and will protect intellectual property, he said.
Lighthizer has been probing China’s IP practices under section 301 of the Trade Act of 1974. The law allows Lighthizer, at the president’s discretion, to take broad steps, including tariffs, to correct against any harm against U.S. businesses.
The USTR has argued that China uses a range of practices to force companies to transfer IP, and Chinese entities engage in widespread theft of U.S. trade secrets, as it seeks to become a leader in advanced manufacturing and artificial intelligence. U.S. businesses in China have long complained about being forced to hand over technology as the price of gaining access to the market.
Republican House Ways and Means Committee Chairman Kevin Brady on Wednesday cautioned against the U.S. imposing “indiscriminate” tariffs against China and he encouraged a wider public discussion before the U.S. takes new trade measures. It’s “not about backing down, it’s about hitting the target,” said Brady.
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