President Trump adds another campaign promise to the giant heap of winning, imposing harsh tariffs on imported washing machines and solar panels on Monday, marking his first moves to erect trade restrictions under seldom-used trade laws that allow unilateral actions.
The decisions in the two “Section 201” safeguard cases followed findings by the U.S. International Trade Commission that both imported products “are a substantial cause of serious injury to domestic manufacturers,” U.S. Trade Representative Robert Lighthizer said in a statement.
The washer tariffs exceeded the harshest recommendations from ITC members, while the solar tariffs were lower than domestic producers had hoped for.
President Trump will impose a 20 percent tariff on the first 1.2 million imported large residential washers in the first year, and a 50 percent tariff on machines above that number. The tariffs decline to 16 percent and 40 percent respectively in the third year.
A 30 percent tariff will be imposed on imported solar cells and modules in the first year, with the tariffs declining to 15 percent by the fourth year. The tariff allows 2.5 gigawatts of unassembled solar cells to be imported tariff-free in each year.
Whirlpool Corp, which brought the washers “safeguard” case against rivals Samsung Electronics and LG Electronics after years of anti-dumping cases, stands to benefit from the decision.
“This announcement caps nearly a decade of litigation and will result in new manufacturing jobs in Ohio, Kentucky, South Carolina and Tennessee,” Whirlpool Chairman Jeff Fettig said in a statement.
“By enforcing our existing trade laws, President Trump has ensured American workers will compete on a level playing field with their foreign counterparts.”
The decisions were the first of several potential tariff actions that Trump may take in the coming weeks and months. He is considering recommendations on import restrictions for steel and aluminum on national security grounds under a 1962 trade law and tariffs or other trade sanctions against China over its intellectual property practices.
The intellectual property, washer and solar panel probes were done under a 1974 trade law that has been seldom invoked since the World Trade Organization was launched in 1995.
The domestic solar panel producers who sought the trade remedies wanted tariffs of 50 percent – the highest allowed under law. Petitioners Suniva and SolarWorld have said they cannot compete with the influx of cheap imports, mostly from China.
Solar panel prices have dropped more than 30 percent since early 2016, benefiting buyers but harming producers across the globe.
Suniva, applauded the decision, saying:
“Over the last 5 years, nearly 30 American solar manufacturers collapsed. Today the President is sending a message that American innovation and manufacturing will not be bullied out of existence without a fight.”