President Trump tweeted Sunday that tariffs on $200 billion of Chinese goods could increase to 25% on Friday, even though the administration reported in recent weeks that trade talks with Beijing were going well. The stock market of course took a tumble with the news. 

President Trump also threatened to impose 25% tariffs on an additional $325 billion of Chinese goods very soon. The problem is obviously that the President feels that trade talks with China are progressing, but have been moving much too slow over the last 10 months as Beijing tries to re-negotiate and defend its position. 

In the big picture, the U.S. imports goods from China totaled $539.5 billion, and the trade deficit was $419.2 billion in 2018, according to the Office of the U.S. Trade Representative. If President Trump follows through with his new plan, virtually all goods imported from China to the U.S. would face a tariff. 

There are those who remain hopeful that a deal could still materialize with China before the Friday deadline. The White House said Wednesday the latest round of talks had moved Beijing and Washington closer to an agreement. Press secretary Sarah Sanders said, “Discussions remain focused toward making substantial progress on important structural issues and re-balancing the U.S.-China trade relationship.” 

Major points of contention between the U.S. and China have been intellectual property theft and forced technology transfers. There has also been disagreement as to whether tariffs should be removed or remain in place as a form of enforcement.

In other developments amid increasing Congressional pressure, USTR Representative Robert Lighthizer stated that the USTR is currently working on a Section 301 Exclusion Process for List #3. The agency is in the preparation stage to initiate a process by the end of the month.