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American Shipper

Trump assesses broad tariffs on residential washers, solar cells

President Donald Trump approved an in-quota 20 percent safeguard tariff for large residential washer imports and a 30 percent tariff on solar cells, the Office of the U.S. Trade Representative announced Monday.

   President Donald Trump has approved an in-quota 20 percent safeguard tariff for large residential washer imports and a 30 percent tariff on solar cells pursuant to separate Section 201 global safeguard investigations, the Office of the U.S. Trade Representative announced Monday.
   Trump accepted the interagency Trade Policy Staff Committee’s recommendations, said U.S. Trade Representative Robert Lighthizer, which were submitted after the International Trade Commission’s (ITC’s) batch of recommendations sent in November.
   The first 1.2 million finished washers imported during the first year of the tariff will be subject to a 20 percent tariff, while imports within that threshold in year two and year three will incur tariffs of 18 percent and 16 percent, respectively.
   Imports in excess of 1.2 million finished washers in the first, second and third years will require tariff payments of 50 percent, 45 percent and 40 percent, respectively.
   The measures also include a tariff on covered parts of 50 percent to decrease to 45 percent in year two and 40 percent in year three.
   The tariff would be spared on the first 50,000 “units” of covered parts in the first year, the first 70,000 units in the second, and the first 90,000 imported units in year three.
   The tariffs stem from a petition filed with the ITC in June by Whirlpool, to determine whether increased imports were a substantial cause of serious injury to domestic industry.
   The Commerce Department issued antidumping and countervailing duties on imported washers, after South Korean producers LG and Samsung, which make most washers imported into the U.S., shifted production to China.
   Commerce then issued another antidumping order on washers from China in early 2017, leading producers to shift production again, this time to Vietnam and Thailand.
   The ITC’s safeguard investigation found imports of large residential washers steadily increased from 2012 to 2016, and domestic producers’ financial performance “precipitously” dropped.

Solar Cell Safeguards. In the same action, but responding to a separate safeguard investigation, Trump ordered a tariff of 30 percent on solar modules and cells in year one, decreasing 5 percent year-over-year, with the fourth year being the final year of Section 201 tariffs.
   The first 2.5 gigawatts of solar cell imports in each of those years will be exempt from the safeguard tariffs.
   Separately, USTR will engage in discussions among interested parties that “could lead to positive resolution” of separate antidumping and countervailing duties currently applying to Chinese solar products and U.S. polysilicon, according to the agency. “The goal of those discussions must be fair and sustainable trade throughout the whole solar energy value chain, which would benefit U.S. producers, workers, and consumers,” the agency said.
   The ITC started its solar cell safeguard investigation in May pursuant to a petition by Suniva.
   The volume of annually installed solar generation capacity in the U.S. more than tripled from 2012 to 2016, helped by artificially low-priced solar cells and modules from China, according to a USTR fact sheet on the safeguard remedies applied to solar cells.
   While the tariffs apply to all solar cell imports, the fact sheet criticizes China for state-directed initiatives that grew its proportion of global solar cell production from 7 percent in 2005 to 60 percent in 2017.
   The U.S. imposed antidumping and countervailing duties on Chinese solar cells in 2012, but Chinese producers evaded the duties through “loopholes” and “relocating production” to Taiwan, and in 2013, Chinese producers moved more production abroad, including to Malaysia, Singapore, Germany and South Korea.
   U.S. imports grew by about 500 percent from 2012 to 2016, and prices fell by about 60 percent.

Exemptions. Trump’s remedies on washer imports exempt Canada, which was found to not account for a substantial share of imports and to not contribute importantly to serious domestic injury, USTR’s fact sheet says.
   Consistent with U.S. World Trade Organization obligations, the U.S. is excluding all Generalized System of Preferences (GSP) countries accounting for less than 3 percent of total imports from both safeguard measures.
   Thailand accounted for more than 3 percent of total imports in the washers case, so that GSP beneficiary will be subject to those safeguard tariffs, USTR said.
   Further, Thailand and the Philippines accounted for over 3 percent of total imports in the solar cells case, so they will be subject to the applicable tariffs.

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