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US considers cutting tariffs on China to fight inflation

The US government is considering reducing tariffs on products imported from China – implemented by former President Donald Trump – to reduce inflationary pressures, which have driven up prices paid by US consumers.

Speaking this Wednesday before a committee of the US House of Representatives, Treasury Secretary Janet Yellen said that “certain (tariff) reductions may be justified” to help push prices down.

Trump significantly raised tariffs on imports from China during his trade war with that country, and the current administration of Democrat Joe Biden kept them, considering that some of them are important to guarantee US national security .

Last Monday, Biden already announced the suspension of tariffs on solar panels in four Southeast Asian countries – Thailand, Cambodia, Vietnam and Malaysia – after the US energy sector complained or months of supply chain problems due to a Commerce Department investigation.

Specifically, that department is investigating complaints from a US solar panel manufacturer, Auxin Solar, that Chinese companies are avoiding paying tariffs by diverting part of their operations to Thailand, Cambodia, Vietnam and Malaysia.

The tariff exemption will benefit precisely these four nations, which together represent 80% of solar panel imports.

Prior to that, at the end of May, the US president signed an executive order reducing tariffs on UK steel, imposed in 2018 by Trump.

In his speech at the time, Biden explained that his administration “successfully” concluded negotiations with London on “satisfactory alternative means” in relation to the tariffs imposed by Trump, which he considered that the British steel posed a threat to US national security.

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