By Jacob Pramuk for CNBC.com
President Donald Trump has told his top trade official to consider raising proposed tariffs on $200 billion in Chinese goods to 25 percent from the 10 percent rate his administration is currently mulling, the administration announced Wednesday.
The president's direction to U.S. Trade Representative Robert Lighthizer comes as the White House tries to use duties, among other tools, to push China to abandon alleged unfair practices and reach a potential new trade deal. Trump aims to balance a desire to force Beijing to the negotiating table with efforts to avoid escalation in a potentially devastating trade war.
No particular Chinese action led to the president's recommendation, said a senior administration official, who declined to be named, on a conference call with reporters. Reports leading up the announcement suggested the U.S. could take the action in part because the value of China's currency has fallen, thereby making its exports more competitive.
Asking Lighthizer to consider hiking the tariff rate is part of the administration's ongoing push to get China to open up its markets, increase competition and abandon retaliatory tariffs on U.S. goods levied in response to the duties imposed by Trump, an official said.
"This week, the President has directed that I consider increasing the proposed level of the additional duty from 10 percent to 25 percent. The 25 percent duty would be applied to the proposed list of products previously announced on July 10," Lighthizer said in a statement. "The Trump Administration continues to urge China to stop its unfair practices, open its market, and engage in true market competition. We have been very clear about the specific changes China should undertake. Regrettably, instead of changing its harmful behavior, China has illegally retaliated against U.S. workers, farmers, ranchers and businesses."
The administration will extend the public comment period on the tariff proposal to Sept. 5, from the currently planned Aug. 30, to allow feedback on what tariff rate the White House should impose. The trade representative has not made a final decision on whether to impose the duties.
U.S. trade officials are still engaged with their Chinese counterparts on a potential agreement to avoid a tariff back-and-forth that could wreak havoc on some American businesses and consumers.
The White House's original move last month to target $200 billion in Chinese goods came just days after Beijing retaliated against the administration's imposition of 25 percent tariffs on $34 billion in goods. The Trump administration is currently considering whether to put duties on an additional $16 billion in goods, but that review is ongoing, an official said Wednesday.
Trump, in an interview with CNBC, threatened to impose tariffs on all $505 billion in Chinese goods imported to the United States if Beijing does not make trade concessions.
Both Republican and Democratic lawmakers have shown concerns about possible escalation of a trade conflict with China. The U.S. agricultural industry has also voiced fears about damage wrought by an escalation.