USTR "US-China Tariff Reduction on Exports Worth 45 Trillion Won... Soliciting Opinions on Item Selection"

USTR "US-China Tariff Reduction on Exports Worth 45 Trillion Won... Soliciting Opinions on Item Selection"

'Outcome of US-China Summit' Bilateral Trade Commission Accelerates Operations

The United States and China are accelerating the operation of their trade commissions to reduce tariffs on each other's exports, worth approximately $30 billion (about 45.2 trillion won) each.

According to Reuters, Jamison Greer, the USTR Chief of Staff, stated on the 26th (local time) at a Council on Foreign Relations (CFR) event that the trade commission plans to solicit domestic opinions through a Federal Register notice regarding which Chinese products will have tariffs reduced.

Greer confirmed that the tariff reduction amount is $30 billion for each country, but predicted that such tariff reductions would not bring supply chains back to China.

The Chinese Ministry of Commerce also stated on the 20th that the two countries had agreed in principle to discuss an equivalent tariff reduction framework for goods of equal scale through the trade commission, adding, "The scale is $30 billion each or more."

The establishment of the trade commission, along with the investment commission, was agreed upon during the summit between President Donald Trump and President Xi Jinping on the 14th-15th.

The core of the trade commission is to reduce tariffs only on non-sensitive items determined by each country, and the Chinese Ministry of Commerce explained, "There is a possibility of applying most-favored-nation rates or even lower rates."

However, Greer emphasized that excluding such exceptions, China is still likely to face higher tariffs than other countries, stressing that "maintaining tariffs on China" was one of the outcomes of this meeting.

Greer also stated that the investment commission would not serve to connect investors and projects between the two countries, adding that China's investments in the US would be reviewed on a case-by-case basis.

Greer conveyed that Chinese companies are interested in the supply of US Nvidia's high-performance artificial intelligence (AI) semiconductor H200 to China, but the Chinese Communist Party is more interested in fostering domestically produced chips.