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Retail groups warn of damage from China tariffs ahead of public hearing

American retail groups warned the Trump administration May 11 that its proposed tariffs on billions of dollars of U.S. imports from China would drive down demand for U.S.-made products and lead to higher costs for American consumers and producers.

The National Retail Federation, Retail Industry Leaders Association, United States Fashion Industry Association and more than 100 local retail groups said in their May 11 letter to the Office of the U.S. Trade Representative, or USTR, that the Trump administration's proposed additional 25% tariffs on $50 billion in Chinese imports would particularly harm farmers, who they said cannot easily find new buyers for their products.

"We believe the proposed tariffs will be counterproductive and undermine your efforts to change China's policies and practices," the letter said. "There is no way to scope tariffs such that they would not impose direct and indirect costs on U.S. imports, inputs and exports in a way that strains the global supply chain and drives prices up."

The interagency Section 301 Committee, which includes the USTR, will hold a public hearing on the proposed tariffs at the U.S. International Trade Commission on May 15.

The proposed tariffs target more than 1,300 products, including airplanes, motor vehicles, televisions, household dishwashers and clothes dryers, and come in response to a Section 301 investigation launched by the USTR that found China has forced intellectual property rights transfers of American companies doing business there.

Agriculture, retail and other industries have said the tariffs, if implemented, would disrupt supply chains, raise production prices and raise prices for consumers.

The U.S. Chamber of Commerce also took issue with the tariffs, saying in its May 9 submission to the USTR that they will be particularly damaging to small and medium-size U.S. manufacturers and exporters that relied on certain imported components and inputs.

"The U.S. Chamber supports the Trump administration's focus on China's industrial policies and unfair trade practices, but tariffs are not the answer," the group wrote.

The National Retail Federation also warned in its May 9 "Global Port Tracker" report that the proposed tariffs could pose threats to the imports of goods shipped through U.S. ports.

Negotiators from the U.S. and China are scheduled to meet in Washington next week to discuss the pending tariffs and trade matters, White House Press Secretary Sarah Huckabee Sanders said May 7.

Trump on April 5 also instructed the USTR to draft a list of $100 billion worth of Chinese imports to slap with additional tariffs, though that list has not yet been publicly released.

China has retaliated with its own various 15% and 25% tariffs on U.S. exports, including almonds, walnuts, pine nuts, fruits, wines and pork.