US chemicals industry calls for removal of China tariffs

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A trade group in the US has urged trade representative Katherine Tai to reduce tariffs on chemical goods and pursue new DFTA to further lower barriers to trade.


An industry group representing chemical manufacturers in the US has called on the Biden administration to reverse tariffs imposed on these products as part of the country's trade war with China.

In a letter to new US trade representative Katherine Tai, chief executive of the American Chemistry Council (ACC) Chris Jahn said solving the trade dispute with Beijing and relieving the tariff burden firms face for products such as plastics and chemicals will be vital in boosting productivity for this sector.

The US began imposing tariffs on products including chemicals in 2018, while China responded with its own retaliatory tariffs on many similar US goods, which have hampered many American firms.

"When US tariff rates are low, our industry is more competitive and grows and thrives," Mr Jahn stated.

He also highlighted the benefits of engaging with trade partners such as China, which include encouraging innovation and supporting US production and export of chemical products. 

Mr Jahn therefore urged the US government to follow up its phase-one trade deal with China with a second agreement that would repeal additional tariffs imposed by both countries and that would lower China's most-favoured-nation tariffs. 

Last year, the US chemical sector recorded a trade surplus of $29 billion, which is set to grow further in the coming years. However, Mr Jahn said the industry would benefit from a refocused long-term trade strategy that opens US exports to growing markets around the world. 

At present, many of those markets have high tariffs and complex regulations that put US exports at a disadvantage.

Mr Jahn wrote: "If these markets adopt and implement the high standards embedded in US free trade agreements, US chemical manufacturers will benefit from a more transparent, certain and level playing field that lowers our costs and increases our competitiveness."

The ACC urged the US to start discussing free trade agreements with key emerging markets, as well as consider joining existing multilateral agreements such as the Comprehensive and Progressive Trans-Pacific Partnership.