US official defends need for China tariffs

US president Joe Biden's administration today gave the strongest indication to date that it is not prepared to reconsider its predecessor's protectionist policies, including punitive tariffs on imports from China.

"My broad view is, what we do on offense is more important than what we do on defense," commerce secretary Gina Raimondo told reporters at a White House briefing.

"There is a place for tariffs," Raimondo said. "The fact is China's actions are uncompetitive, coercive, underhanded, and they have proven they will do whatever it takes. And so I plan to use all the tools in my toolbox as aggressively as possible to protect American workers and businesses from unfair Chinese practices."

Biden's administration said in January it would review the tariffs imposed on Chinese exporters and companies in 2018-19, which Beijing reciprocated by taxing imports of US crude, LNG and other goods. But Raimondo's statement indicates that the US is not prepared to unilaterally lift the punitive tariffs even though Biden on the campaign trail criticized them as damaging for US consumers.

Beijing has urged Biden's administration to lift the tariffs, which affect nearly the entire volume of imports from China, as a goodwill gesture to improve frosty relations between the countries. But a recent high level meeting between US and Chinese officials failed to make progress on trade or other issues.

The Biden administration at the same time is signaling it would continue to adhere to the US-China interim agreement, known as the "phase one" deal. The agreement committed China to increasing its purchases of crude, LNG and other US energy commodities by $69bn in 2020-21, from a 2017 baseline. Chinese purchases of US crude last year more than tripled from 2019, but they remain well below the dollar targets set in the phase one deal.

US crude headed to China in February averaged 269,000 b/d, down by about 120,000 b/d from the previous month. China's intake of US crude was volatile last year but exports to that country rose sharply in May-December 2020, averaging 690,000 b/d during that time.

By Haik Gugarats