AsianFin -- Recent reports about China’s tariff exemptions signaled Beijing is gearing up trade negotiations with the U.S.
Credit：China Daily
China has quietly started to grant tariff exemptions for some U.S. goods under a list products that covers 131 items like pharmaceuticals and industrial chemicals, Bloomberg reported on Friday. The 131 items are worth about $40 billion, accounting for around 24% of Chinese imports from the U.S. last year, according to calculations based on China customs data.
It was reported that the list of exempted products has been circulating among traders and businesses over the past week, and at least a dozen of companies in China have been able to import U.S. goods free of levies.
The publication failed to figure out origin of the list as it hasn’t been officially confirmed. But it echoed previous news about a “whitelist” that China has complied for local companies to ease the impact of its trade fight with the U.S.
Reuters earlier this week reported the Chinese government is quietly notifying firms about the policy, though the sources didn’t know how many and which products have been placed on the list to be granted exemptions for authorities didn’t share publicly.
Companies are being privately contacted by authorities and notified tariffs on a list of products classifications that has been waived, the report cited a person at a drug company selling U.S.-made medicines in China. Another source said some companies were informed they can inquire if their imported U.S. products are qualify for the exemption from authorities.
It was reported that the whitelist of products is growing since China has exempted U.S. ethane imports from 125% tariffs. A separate Reuters report noted the recent waiver will ease pressure on Chinese firms that import U.S. ethane for petrochemical production as well as provide an outlet for the natural gas liquid, a byproduct of U.S. shale gas production. It suggested Chinese ethane importers including Satellite Chemical, SP Chemicals, Sinopec, Sanjiang Fine Chemical and Wanhua Chemical Group and U.S. exporters such as Enterprise Products Partners and Energy Transfer would benefit from the waiver.
Beijing last week has been reportedly mulling exempting some U.S. imports from 125% tariffs or has taken actions to grant certain exemptions.Bloomberg reported Friday Beijing is weighing granting pause on 125% retaliatory tariffs on some U.S. goods. The Chinese authorities are considering removing extra levies for medical equipment, some industrial chemicals like ethane and aircraft leases, per the report.
China has exempted some U.S. goods from tariffs and is asking firms to identify critical goods they need free of levy, Reuters a week ago quoted businesses that have been notified.
The American Chamber of Commerce in China (AmCham) said on April 25 that companies in the pharmaceutical sector had reported that they had been able to import drugs to China over the past week with tariff exemptions. “It's pharmaceutical firms on the exemptions, but I believe it is drug-specific and not a sector-wide exemption,” said AmCham President Michael Hart when questioned if he could specify which sectors those companies came from.
China seems to have quietly rolled back 125% tariffs on some U.S.-made semiconductors, CNN on April 25 learned from import agencies in Shenzhen. The import agencies discovered the exemption this week during routine customs procedures, though Beijing hasn’t made any official announcement. They said the exemptions apply to integrated circuits, also known as microchips or semiconductors.
