China is quietly notifying firms of US tariff exemption list: Reuters
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The news: China has compiled a list of US made products it plans to exclude from 125% tariffs, and has begun notifying companies about the policy, according to sources cited by Reuters.
The numbers: While China has already exempted certain products across pharmaceuticals, semiconductors and aircraft equipment, the existence of a ‘whitelist’ had not previously been reported.
Notifying companies directly has also allowed Beijing to maintain its outward messaging of ‘fighting til the end’ on 145% US tariffs, while helping companies with concessions. Beijing reportedly asked companies to identify which products they would require to be levy-free.
The content and volume of the whitelist remains unclear, but the number of exempted products seems to be increasing. Beijing reportedly waived tariffs on ethane imports from the US on Tuesday, as the US is the world’s only supplier.
One source quoted by Reuters said that the Shanghai Pudong government made contact on Monday about the list, adding the firm had previously lobbied for tariff exemptions as it relies on US technologies for some of its products.
Data released on Tuesday showed that China's factory activity contracted at the fastest pace in 16 months in April. While its official purchasing managers' index fell to 49.0 in April from 50.5 in March, according to the National Bureau of Statistics, the lowest reading since December 2023 and falling short of the 49.9 consensus.
At Trump’s 100-day rally on Tuesday, the President touted his “China tariffs”, saying "we're ending the greatest job theft in the history of the world.”
He added that a trade deal with Beijing is on the horizon, but that it is “going to be a fair deal.”
The sources: Reuters, Capital Brief
