Five ways China returns against US tariffs

The trade war between the two largest economies in the world escalates after China withdrew against the introduction of tariffs from the United States with its own measures.

Beijing seeks to focus on specific American retaliatory goods, among other measures, after a 10% tariff introduced by President Donald Trump for all Chinese imports in the United States.

In some way, this latest Titus-for-Ta is nothing new and is based on a long-standing commercial dispute between the nations, with tariffs already imposed and threatened by different goods since 2018.

Trump said he plans to talk to Chinese President Xi Jinping, so a deal can still be achieved. But if China continues with its reply on February 10, as planned, what can be the impact?

Part of China’s counteraction to Trump’s tariffs is to declare its own taxes on US coal and liquefied natural gas (LNG) of 10% and 15% of raw oil fee.

Beijing’s answer means that companies that want to import fossil fuels from the US will have to pay the tax to do so.

China is the largest coal importer in the world, but it receives the bigger part of it from Indonesia, although Russia, Australia and Mongolia are also among its suppliers.

As for the United States, China increases the import of liquefied natural gas from the country, with volumes being almost double levels in 2018, according to Chinese customs data.

But its overall trade in fossil fuels is modest, with US imports representing only 1.7% of the total raw oil in China purchased from abroad in 2023. This suggests that China does not depend on the US and therefore the impact of tariffs on its The economy can be minimal.

Rebecca Harding, a sales economist and CEO of the Center for Economic Security, said China could easily deliver more supplies from Russia, where it already bought oil to the cheap, as the Kremlin seeks to finance its military efforts.

On the reverse side of the United States is the largest exporter of liquefied natural gas in the world, so there are many other customers, especially the United Kingdom and the European Union.

In addition to fuel, China has hit a 10% tariff for agricultural machinery, pickup trucks and some major cars.

But China is not a large importer of American pickups and he receives most of his cars from Europe and Japan, so a 10% tariff for a small number of imports would not hit the consumers too hard.

In recent years, China has increased investments in agricultural machinery to improve production and reduce imports and to strengthen its food security.

So the introduction of tariffs for agricultural machinery may be another move to try to increase the internal industry.

Julian Evans-Pritchard, the leader of the Chinese economy at Consultancy Capital Economics, said all tariff measures are “quite modest, at least compared to US movements.”

He suggests that target goods in China represent about $ 20 billion (£ 16 billion) annual imports – about 12% of China’s total imports from the United States.

“This is far from Chinese goods worth over $ 450 billion directed by the US.”

But he said China “was obviously calibrated to try to send a message to the US (and a home audience) without doing too much damage.”

Chinese authorities have also announced some non -tariff measures, one of which is an antitrust investigation by US technology giant Google.

It is unclear what the investigation will include, but for context, Google search services have been blocked in China since 2010.

The company still has some business presence in the country by providing applications and games in the Chinese markets, working with local developers.

But China generates only about 1% of Google’s global sales, suggesting that if it reduces its connections entirely with the country, it will not be much worse.

China added PVH, the American company that owns designer brands Calvin Klein and Tommy Hilfiger, in its so -called. The list of “unreliable entity” and accused them of “discriminatory measures against Chinese enterprises”.

The list, which has other companies in the United States, was created in 2020 by Beijing against the background of commercial voltage heating.

For Calvin Klein and Tommy Hilfiger, being on the list of China will make it difficult for business in the country. They may encounter sanctions, including fines and cancel the work visas of their foreign employees.

Regulators will also go to factories of operations investigation companies, according to Andreas Shutr, Professor of International Business at the Western University of Ontario, Canada.

The United States has its own “list of subjects”, which prevents certain organizations from buying products from US companies without approval from Washington.

“China hits the same way that President Trump blames Chinese companies. All of this is part of US US and China’s US -driven,” Prof. Sutr added.

While the tariffs are placed on companies that want to import goods from abroad, China also imposed export control of 25 rare metals.

Some of the metals are key components for many electrical products and military equipment.

China has mastered the ability to improve such metals and produce almost 90% of global refined production.

The limited list includes tungsten, which is difficult for a source and decisive material for the aerospace industry.

Although there are export restrictions, Mr. Evans-Prichard from the capital economy said it was remarkable that the critical metals of China from the United States, which are used to make chips of high-end, semiconductor machines, pharmaceuticals and aerospace equipment They were not aimed at this any measures.

The experience of previous circles of restrictions suggests that exports will decrease sharply as companies are arguing to obtain licenses, a process that takes several weeks.

As for the impact of restrictions, the US seems to have a plan. On Monday, Trump said he wanted Ukraine to guarantee the supply of more earth metals in exchange for $ 300 billion in support in his fight against Russia.