China is thinking about removing the high 125% tariff it placed on some US products. This decision is being considered because the ongoing trade war with the United States is creating problems for some parts of China’s economy.
According to people who know about the discussions, the Chinese government may stop charging extra taxes on US medical equipment and some chemicals like ethane. Officials are also talking about removing the tariff on aircraft leasing. Many Chinese airlines do not own their planes and instead pay to use them. The extra tax would make these payments too expensive.
The news affected the market quickly. The value of China’s currency, the yuan, went up slightly after the reports.
This possible move is similar to what the United States did earlier this month, when it removed some electronics — like smartphones and computers — from its list of Chinese products with high tariffs. These actions show that both countries are still very connected in trade, even though they are in a trade war.
Even though China is a major producer of plastics, some of its factories need ethane from the US. Also, Chinese hospitals still depend on American-made medical tools like MRI and ultrasound machines from companies such as GE Healthcare.
China’s Ministry of Finance and Customs Department have not commented on the matter yet. The list of US products that may get exemptions is not final, and talks are still going on. Some Chinese companies have been asked to send in product codes for the US goods they want to be free from tariffs.
There are also reports that China may cancel extra taxes on at least eight items used in making computer chips, though memory chips are not included for now. This could be bad news for Micron Technology, a major US memory chipmaker.
So far, the US and China have not restarted full trade talks. Chinese leaders say they will only return to talks if the US cancels all one-sided tariffs. US President Donald Trump wants to speak directly with Chinese President Xi Jinping, but China prefers to let lower-level officials handle talks first.
Earlier this month, the US removed tariffs on several popular electronics from China. This helped big tech companies like Apple and Nvidia. But experts say these changes could be temporary, and more updates may come soon.
Both countries are under pressure. Their businesses and industries want relief from the heavy costs of the trade war. For now, the world is watching to see if these tariff removals will lead to better trade relations.
