China halves tariffs for US products on coronavirus situation deterioration

The Chinese authorities halved duties on a number of goods imported from the U.S. for a total of USD 75 bln, Reuters reports.

"While the announcement reciprocates the U.S. commitment under the deal, it is also seen by analysts as a move by Beijing to boost confidence amid a virus outbreak that has disrupted businesses and hit investor sentiment," the message reads.

China’s finance ministry said in a statement that from 0501 GMT on Feb. 14, additional tariffs levied on some goods will be cut to 5% from 10% and others lowered to 2.5% from 5%, Reuters writes.

The ministry did not state the value of the goods affected by the decision, but the products benefiting from the new rule are part of the USD 75 bln of goods that China announced last year that it would impose 5% to 10% tariffs on, which came into effect on Sept. 1.

"In a separate statement, the finance ministry said the tariffs reduction corresponds with the those announced by the United States on Chinese goods, which were also scheduled for Feb. 14," Reuters adds.

The reductions will cut tariffs on soybeans from 30% to 27.5%, although some traders say the impact could be limited as the 25% tariffs remain in place. Duties on crude oil will fall to 2.5% from 5% that was imposed in September.

The remaining tariffs were scheduled to kick in Dec. 15 but were suspended due to the interim trade deal. The news was positive for financial markets and comes as Beijing seeks to shore up investor and business confidence in China as a virus outbreak casts deep uncertainty over the economic outlook.

Previously reported that further spread of coronavirus (2019-nCoV) and reduced import demand triggered a decline in grain export quotations in the Black Sea region last week.