Trump administration tees up next tariffs on $200 billion in Chinese goods

The Trump administration has released a new list of $200 billion in Chinese goods that would be subject to higher tariffs as promised in retaliation for Chinese tariffs in retaliation for earlier U.S. tariffs. The new tariffs won’t go into effect until the end of August. On the new list are products such as TVs, air conditioners, clothing, and bed sheets.

The new round of tariffs adds a new wrinkle to the U.S-China tariff war. China bought only about $135 billion in U.S. goods last year so Beijing will run out of U.S. exports to slap with a higher tariff before it can match the U.S. list.

Which leads trade analysts and economists to expect that China’s response will include non-tariff measures such as new administrative rules and enforcement that will slow U.S. companies doing business in China, new domestic taxes on U.S. companies, efforts to “encourage” Chinese companies to find non-U.S. suppliers, and promoting a boycott of U.S. goods and businesses in China. (If you add revenue that U.S. companies collect in China to total U.S. exports to China, the U.S. trade deficit with China becomes a $20 billion surplus. Apple, for example, gets 20% of its revenue from sales in China.)

You can certainly take all of the opportunities for additional U.S. exports to China in areas such as food and energy off the table. The acquisition of NXP Semiconductors by Qualcomm (QCOM), which has been waiting for approval from Chinese regulators, is back on hold.

There are no publicly announced plans for negotiations between the United States and China ahead of the August deadline.

U.S. markets aren’t amused but they haven’t moved into panic mode either. The Standard & Poor’s 500 stock index is down 0.53% and the Dow Jones Industrial Average is lower by 0.6%. The tech-heavy NASDAQ Composite is lower by 0.45% as of 12:30 p.m. in New York.