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Restrictions aim to boost US manufacturing, but critics warn they will slow shift to renewable energy and increase consumer costsThe US president, Donald Trump, has announced steep tariffs on imported washing machines and solar panels, giving a boost to Whirlpool Corp and dealing a setback to the renewable energy industry in the first of several potential trade restrictions. The decisions in the two “Section 201” safeguard cases followed findings by the US International Trade Commission (ITC) that both imported products “are a substantial cause of serious injury to domestic manufacturers,” US trade representative Robert Lighthizer said. Continue reading...
When we reported earlier today that President Trump lobbed the first real shot in the global (but mostly Asian) trade war when the White House announced it would slap imported solar cells and washing machines with up to 50% tariffs - Trump's most significant trade action to date, taking direct aim at China and South Korea (full details here)- we said that "we now await China's (or South Korea's) response..." We didn't have long to wait. South Korea stormed out of the gate, with Reuters reporting that it will complain with the WTO against the U.S. for imposing anti-dumping duties on Korean washing machine and solar panel makers, a decision Trade Minister Kim Hyun-chong called “excessive” and "regrettable." Kim warned that the US safeguard decision is "excessive" and violates WTO provisions. As a reminder, the United States will impose a 20 percent tariff on the first 1.2 million imported large residential washers in the first year, and a 50% tariff on machines above that number. The tariffs decline to 16% and 40% respectively in the third year. "The United States has opted for measures that put political considerations ahead of international standards,” Kim said in a meeting with industry officials on Tuesday. "The government will actively respond to the spread of protectionist measures to defend national interests," he said. South Korea will also consider discussing steps jointly with other countries subject to the imposition, the trade ministry said, meanwhile the South Korean government said it would help Samsung and LG in finding alternative markets for the sale of washing machines. Additionally, Bloomberg reports that South Korea will also seek to retaliate in kind by reinstating tariffs on the U.S. in what has been dubbed the "Washing Machine" row. To do that, South Korea asked the World Trade Organization to approve suspension of trade concessions, the trade ministry says in an emailed statement. Yet while S. Korea flexes its diplomatic muscle, local producers of washing machines - which may see tariffs as high as 50% - tumbled: Woongjin Energy dropped as much as 9.4%, LG Electronics slid 5.1%; Hanwha Chemical dropped 4.3% before rebounding, OCI dell as much as 3.5%, and Samsung SDI was down 1.7%. Before markets even opened, companies reacted: the decision means everyone will pay more, Samsung Electronics said on its website according to Bloomberg. To minimize losses from the US tariffs, LG Electronics is expected open new American plants early and expanding production at existing plants in the country (in other words, Trump may be winning again). And while S.Korean consumer electronics companies were hurt by Trump's tariffs, in China it will be the solar companies that were affected. Here Trump announced a 30% tariff on imported solar cells and modules in the first year, with the tariffs declining to 15% by the fourth year. The tariff allows 2.5 gigawatts of unassembled solar cells to be imported tariff-free in each year. Beijing was just as quick to respond to Trump's announcement, warning that China is "strongly" dissatisfied with U.S. tariffs on solar imports. The Chinese Ministry of Commerce added that US tariffs on solar products and washing machines are a misuse of trade remedy measures, and warned that U.S. tariffs will hurt healthy development of its industries and worsen global trade environment The ministry also said that China hopes the U.S. will show restraint in trade restrictions, although it did not specify what remedy China would pursue in response. We anticipate a proportional tit-for-tat, even though US exports to China are far less relevant to the global trade picture and capital flows than vice versa. Meanwhile, US companies are already winning: Whirlpool said it’s adding 200 jobs moments after the Trump Administration's announcement of the tariff of up to 50 percent on large residential washing machines, aimed at penalizing Samsung and LG Electronics. The new full-time employees will work at a factory in Clyde, Ohio, Whirlpool said on Monday. The American appliance maker also vowed to make broader investments in manufacturing and innovation. Whirlpool, based in Benton Harbor, Michigan, renewed allegations last year that its South Korean rivals illegally undercut prices on washing machines. In May, it filed a so-called safeguard petition, which is meant to provide help to domestic manufacturers hurt by importers selling products at excessively low levels. "This is a victory for American workers and consumers alike," said Whirlpool CEO Jeff Fettig. "By enforcing our existing trade laws, President Trump has ensured American workers will compete on a level playing field with their foreign counterparts, enabled new manufacturing jobs here in America and will usher in a new era of innovation for consumers everywhere." Fettig served as a member of the president’s manufacturing council, which however disbanded itself last year after a controversy over Trump’s remarks about a white supremacist rally in Charlottesville, Virginia. As for victorious American consumers, let's first wait and see just how China and South Korea will respond in what is now clearly a tit-for-tat escalating trade war.
Consumers Likely Losers As Trump Tariff Takes Another Stab at Helping Whirlpool Fend Off Samsung, LG
President Trump announced on Monday trade tariffs aimed at protecting the U.S. washing machine industry, at the behest of Whirlpool. Problem is, South Korea's Samsung and LG saw this coming. In fact, this is not a new story. This is global manufacturing Whac-A-Mole. Ultimate losers: Consumers.
President Donald Trump took his first major action as trade enforcer-in-chief, opening the door to a host of other trade restrictions that buck the global order and give him a hammer to push his “America First” vision at the gathering of global elites in Davos, Switzerland.The decision to slap tariffs and other trade restrictions on imports of both solar panels and washing machines is being seen as a prelude to coming actions on steel and aluminum imports, as well as a wide-ranging case that aims to punish China for intellectual property abuses. “The president’s action makes clear again that the Trump administration will always defend American workers, farmers, ranchers, and businesses in this regard,” U.S. Trade Representative Robert Lighthizer said in a statement.But even as Trump trumpeted that his move fulfills a long-held promise to defend American manufacturers, the restrictions themselves appeared unexpectedly restrained. That could be a sign that the White House took under consideration warnings that — in the case of solar — thousands of installation and other related jobs across the U.S. could be lost if the flow of cheap solar panels were cut off.The actions hew closely to the recommendations of the U.S. International Trade Commission, a quasi-judicial body. It initially determined that the affected U.S. companies were at risk of being damaged by unfairly priced and subsidized imports.The efforts are the result of a pair of rarely seen Section 201 investigations, a provision under trade law that allows U.S. companies to petition for remedies on a global basis as opposed to the country-specific approach most trade cases follow.The tariffs that Trump set on solar products — 30 percent in the first year and stepping down by 5 percentage points over each of the next three years — were short of the 50 percent limit he is allowed to impose under Section 201 of the Trade Act of 1974. The three years of trade restrictions on washing machines and parts will be set via a so-called tariff-rate quota, which allows imports of a certain number of fully assembled machines under a 20 percent tariff. Imports beyond the quota will be subject to a much higher 50 percent tariff the first year. The remedy stops short of Whirlpool’s petition for a flat 50 percent tariff on imported machines made by rivals Samsung and LG. The effects of the decisions could soon be felt as other countries gear up legal challenges that could come with the potential for billions of dollars' worth of retaliation. The last time a similar measure was used dates to 2002, when President George W. Bush approved global tariffs on steel imports. However, those tariffs were withdrawn a little more than a year later after the WTO ruled them to be illegal and authorized the European Union to impose retaliatory duties on $2.2 billion worth of U.S. goods ranging from oranges to textiles.Under Section 201, countries that the United States has trade agreements with are usually exempted from trade remedies — and the ITC commissioners had recommended to exclude them. But only developing countries with a very small percentage of imports were excluded in both the washing machine and solar actions; Canada was the only other country excluded from trade restrictions on washing machines.The moves could embolden other U.S. manufacturing sectors waiting in the wings to petition for similar measures, said Chad Bown, a senior fellow at the Peterson Institute for International Economics.“By imposing tariffs in these two cases, President Trump just ended any doubt that he was hesitant on protectionism. But the big worry is the potential tariffs that are still to come,” he said.U.S. manufacturing groups praised the actions, hoping they do indeed portend a coming wave of actions aimed at protecting U.S. workers. "Now that President Trump has taken action in these high-profile cases, we hope that he also will keep his promise to defend American-made steel and aluminum,” said Scott Paul, president of the Alliance for American Manufacturing.Sen. Sherrod Brown cheered the curbs on washing machines. The Ohio Democrat has found trade to be a rare area of cooperation with the Trump administration. Lighthizer briefed Brown earlier Monday by telephone before the actions were announced, and the lawmaker has been in close contact with the administration throughout the investigation, a source said. “This is welcome news for the thousands of Whirlpool workers in Clyde, Ohio, whose jobs have been threatened by a surge of cheap washers,” Brown said in a statement.Whirlpool, based in Michigan, announced Monday that it would be able to add 200 new positions at its Ohio plant.But in both cases, free-trade advocates say that the moves would do more harm than good. While the actions may help the two solar companies that petitioned for the duties — Suniva and SolarWorld Americas — critics have warned that lifting the costs of solar energy could hamstring the industry that has seen torrid growth over the past decade and is now cheaper than coal and natural gas-fired electricity in parts of the country. “More good-paying jobs will be jeopardized by today’s decision than could possibly be saved by bailing out the bankrupt companies that petitioned for protection,” Clark Packard, trade policy counsel at the conservative R Street Institute, said in a statement. “Today’s decision also will jeopardize the environment by making clean energy sources less affordable.”Samsung and LG — the South Korean companies targeted in the washing machine case — have warned that restrictions could hinder their ability to ramp up production and hire U.S. workers at new factories in South Carolina and Tennessee. Samsung cut the ribbon on its new South Carolina plant this month with the first washing machine rolling off a production line that will employ 600 workers.“This tariff is a tax on every consumer who wants to buy a washing machine,” a Samsung spokeswoman said in a statement. “Everyone will pay more, with fewer choices.”Eric Wolff contributed to this report.
WASHINGTON/LOS ANGELES (Reuters) - U.S. President Donald Trump slapped steep tariffs on imported washing machines and solar panels on Monday, giving a boost to Whirlpool Corp and dealing a setback to the renewable energy industry in the first of several potential trade restrictions.
Whirlpool Corp. (WHR) is slated to release fourth-quarter 2017 results on Jan 24. The primary concern for the company in recent quarters has been raw material cost inflation and unfavorable price/mix.
Government criticised over response to potential dangers of tumble dryers, fridge freezers and other productsThe government has been criticised by MPs for being slow to overhaul a “flawed and poorly resourced” safety regime for electrical white goods that has allowed 1m potentially dangerous tumble dryers to be in use in homes across the UK.The business, energy and industrial strategy select committee is also urging manufacturer Whirlpool to repair faulty machines within two weeks of being contacted by owners, or explain what action it plans to take to deal with the problem. Continue reading...
More than a million fire-risk dryers are still being used in UK homes, a committee of MPs says.
MODONS: Scientists Observe Bizarre ‘Double Whirlpools’ in The Ocean For The First Time. “Further investigations revealed this double whirlpool was no fluke. It turns out satellites had been recording these phenomena swirling below them for a quarter-century at least, just nobody had realised what they were.” I wonder what else we’re observing, but not seeing.
Samsung и LG ввезли в страну около трех миллионов стиральных машин в 2016 году, сказала Whirlpool. В заявлении Whirlpool сказала, что она "воодушевлена" этим решением и что она "остается оптимистично настроенной, что администрация реализует полные и соответствующие меры, чтобы гарантировать, что Samsung и LG не смогут обходить любой элемент решения".
(Don Boudreaux) TweetGeorge Will calls out the hypocrites at Whirlpool and warns Americans to reject their – and similar – cronyist pleas for punitive tariffs on imported home appliances punitive taxes on Americans who choose to buy imported home appliances. Here’s Will’s opening paragraph: A household appliance will be the next stepping-stone on America’s path to restored […]
Гаджеты становятся с каждым годом все более "умными" и инновационными. Но не всегда разумно покупать очередную технологическую новинку сразу после ее появления в продаже. С покупкой каких устройств техно-гикам лучше повременить в грядущем 2018 году?