U.S. and China Reach Phase 1 Deal

US And China Reach Phase 1 Deal

The reduction of tariffs to 7.5 percent on products on list 4a and the cancellation of tariffs on list 4b are an important start, according to MEMA, but the association encourages the administration to review the 25 percent tariffs still in place on $250 billion of goods.

From MEMAWashington Insider

MEMA has stated it is encouraged by the news that the administration reached a “Phase One” trade agreement with China. The reduction of tariffs to 7.5 percent on products on list 4a and the cancellation of tariffs on list 4b are an important start, according to MEMA, but the association encourages the administration to review the 25 percent tariffs still in place on $250 billion of goods. In many cases, these tariffs are causing financial strain on suppliers throughout the U.S.  

The Office of the United States Trade Representative announced an agreement on a “Phase One” deal with China that will alleviate some tensions in trade relations between the two countries.

The deal, according to a press release published by the USTR on Dec. 13, “requires structural reforms and other changes to China’s economic and trade regime in the areas of intellectual property, technology transfer, agriculture, financial services, and currency and foreign exchange. The Phase One agreement also includes a commitment by China that it will make substantial additional purchases of U.S. goods and services in the coming years. Importantly, the agreement establishes a strong dispute resolution system that ensures prompt and effective implementation and enforcement.”

As part of the deal, the U.S. has decreased some of the tariffs that it had initially imposed on China as well as cancel plans to place tariffs on $156 billion of imports. The USTR states that the U.S. will continue to impose 25 percent tariffs on about $250 billion and 7.5 percent tariffs on approximately $120 billion worth of Chinese goods. Many of the parts are imported by motor vehicle suppliers are included in the $250 billion lists that remain at a 25 percent tariff rate.

MEMA said it applauds the work both parties have invested to reach this point and urges them to continue working toward future agreement. “We have repeatedly called for an agreement between the U.S. and China that will allow U.S. companies to remain competitive in a global marketplace while protecting intellectual property (IP) rights. It is our hope that this positive step has begun to address this long-term problem,” MEMA stated.

You May Also Like

SEMA Urges Members to Support Tax Relief Bill

The Tax Relief for American Families and Workers Act of 2024 benefits specialty automotive aftermarket businesses, according to SEMA.

SEMA Action Network

SEMA is encouraging its members to reach out to their representatives and ask for their support on H.R. 7024, the Tax Relief for American Families and Workers Act of 2024. The bill, which The U.S. House of Representatives is expected to vote on this week, benefits specialty automotive aftermarket businesses, according to SEMA, by allowing for the immediate expensing of R&D and investments in equipment and increasing the small business expensing cap by nearly 30%.

ASA Endorses Bipartisan Tax Framework

The Automotive Service Association says the legislation is beneficial for independent automotive repair businesses.

Industry Partners Urge Congress to Pass R&D Deductibility Fix

“Congress must restore this tax provision to enhance U.S. competitiveness, job creation and innovation as soon as possible,” said Ann Wilson, MEMA’s executive vice president of government affairs.

Legislators Challenge Vehicle Data Access ‘Double Standard’

Rep. Marie Gluesenkamp Pérez joined other legislators in sending a letter to NHTSA about proposed guidance for implementing the Massachusetts Right to Repair law.

House Passes Bill to Stop EPA Emissions Mandate

The U.S. House passed the “Choice in Automobile Retail Sales (CARS) Act” (H.R. 4468) with bipartisan support.

Opposition Grows for California’s Mandate Banning New Gas-Powered Vehicle Sales

Other Posts

China OEMs: Growing Protectionism Sentiment in US Govt.

Glick discusses whether trade issues, particularly with China, will be decisive in the upcoming election, among other topics.

China’s Automotive Industry: 2023 Review and 2024 Outlook

Bill Russo offers predictions for 2024 and beyond for the China automotive industry and its key players, among other interview topics.

China’s Automotive Industry 2023 Review and 2024 Outlook
Chijet Motor Signs Agreement to Boost Automotive Cybersecurity

Chijet Motor Company, Inc., a high-tech company engaged in the development, manufacture, sales and service of traditional fuel vehicles and new energy vehicles (“NEV”) in China, announced a strategic cooperation framework agreement with Changsha Automobile Innovation Research Institute and Zhiche Xinan (Suzhou) Information Security Technology Co. Ltd., that it said is aimed at significantly boosting

Chijet Motor Co. Signs Strategic Agreement for Automotive Cybersecurity
XPENG Expands ADAS System Coverage in China

The company plans to extend its ADAS coverage to 200 cities across China by early 2024.