Janice R. Andrews
China is very angry that the US has decided to raise taxes on important Chinese industries, such as semiconductors, electric cars (EVs), and photovoltaic cells. The Beijing Ministry of Commerce was unhappy with the actions and said that Washington’s choices would hurt global supply lines without helping American companies.
Beijing wants the U.S. to change its mind, and leaders have warned that China will do what it takes to protect its own businesses. The final taxes were put in place last week. They are part of a larger review under Section 301 of the U.S. Trade Act of 1974, which is meant to stop unfair trade practices.
The U.S. Trade Representative (USTR) revealed new tariffs on a number of Chinese goods, ranging from 25% to 100%. These included a 100% tax on Chinese electric vehicles (EVs) and a 25% increase on EV batteries. Within two weeks, these steps will become law. Tariffs on semiconductors and solar cells will also go up to 50%, which will make trade relations between the two giants even worse.
In reaction, the Ministry of Commerce stressed that these actions would make things more expensive for companies and consumers in the U.S. and would hurt the order of international trade. The tariffs might mess up the global supply line for goods and services, and they won’t solve America’s problems with its trade gap or its ability to compete in the global market.
China’s trade development body also didn’t like the U.S. move and said it would hurt long-term business cooperation between the two countries. U.S. officials say that these tariffs are needed to stop China’s unfair trade practices, but the finalization of these duties is bad news for efforts to calm trade issues, especially since the U.S. election is coming up soon.
As both sides prepare for the effects on their economies, all eyes are still on whether diplomacy attempts can stop things from getting worse.
