WASHINGTON — Beijing promptly replied to President Donald Trump’s tariffs on Tuesday, releasing a slew of countermeasures aimed at American companies and crucial product imports.
Trump’s 10% tax on all Chinese products went into effect at 12:01 a.m. Tuesday, following an executive order issued over the weekend to pressure Beijing to crack down on fentanyl supplies into the United States.
The Chinese government responded with a slew of retaliatory measures, including increased taxes on liquefied natural gas, coal, farm machinery, and other US imports. It also stated that it has imposed limits on the export of some essential minerals, many of which are utilized in the manufacture of high-tech items.
Furthermore, Chinese market regulators announced that they had begun an antitrust inquiry into Google. Google’s internet access has been blocked in China, but the action may affect the company’s business relationships with Chinese enterprises.
The US tariffs, which Trump described on Monday as a “opening salvo,” are in addition to duties levied by the president during his first term. Many Chinese imports were already subject to 10% or 25% tariffs, and the new measure adds a 10% levy to more than $400 billion in commodities purchased by Americans from China each year.
Trump had planned to impose tariffs on America’s three main trading partners, Canada, Mexico, and China, in varied degrees. However, after days of frenzied discussions, Trump decided to delay tariffs on Mexico and Canada for 30 days in exchange for the Canadian and Mexican governments agreeing to increase their monitoring of fentanyl and the border.
On Monday, Trump announced that he expected to speak with Chinese President Xi Jinping within the next 24 hours, although it was unclear when the call would take place. Before there was any hint of a call, Chinese authorities implemented efforts to punish American corporations.
China’s counterpunches appeared to be an attempt to harm American businesses and send a warning to the Trump administration, while keeping measures in reserve that may do far more catastrophic harm to trade between the world’s two largest economies. However, even if Trump signals a readiness to negotiate, Chinese officials may take some time to reverse the measures issued by Beijing, particularly the tariffs and export limits.
“As far as I can see, it’s a relatively limited response, affecting no more than 30% of US exports to China,” said Bert Hofman, a former World Bank official who is now an adjunct professor at the National University of Singapore’s East Asia Institute. “They’re probably trying to keep their powder dry, because this could still be only the first step from the Trump administration.”
The Trump administration’s tariffs “seriously undermine the rules-based multilateral training system, damage the foundation of economic and trade cooperation between China and the United States, and disrupt the stability of global industry supply chains,” China’s Ministry of Commerce said in a statement.
The commerce ministry and China’s customs agency have imposed additional limits on exports of tungsten, tellurium, molybdenum, and other metals critical to industry and innovative technologies, citing “national security and interests.”
China’s tax officials announced an additional 10% levy on crude oil, agricultural equipment, larger automobiles and pickup trucks, and a 15% tariff on coal and natural gas.
China also announced the addition of two American companies to its “unreliable entities” list. One of the companies, PVH, the American retailer that owns the Calvin Klein and Tommy Hilfiger brands, had already being investigated by Chinese authorities in September. China said PVH had implemented “discriminatory measures” against commodities from Xinjiang, in the country’s far west.
Google did not immediately react to a request for comment following the disclosure of the antitrust inquiry.
While Google dominates the world in digital advertising and internet search, regulations in China prevent it from operating its search engine, YouTube video platform, or Google Play app store in the nation. Nonetheless, some Chinese phone manufacturers, such as Xiaomi, Lenovo, and Vivo, employ Android as their operating system. Regulators around the world, including those in the United States, Canada, Europe, and South Korea, have investigated Google on antitrust grounds or filed related actions.
Aside from imposing fresh duties, Trump’s executive order, signed on Saturday, removed a popular loophole used by many Chinese companies to transport goods to the United States without paying the tariffs imposed by the president in 2018. The de minimis provision enables popular e-commerce companies such as Shein and Temu to transmit billions of dollars in merchandise directly from Chinese producers to American consumers without paying duties.
Trump’s agreements with Canada and Mexico on Monday brought the United States back from the brink of a potentially disastrous trade war with two of its closest friends. However, it did not eliminate the possibility of similar confrontations occurring hereafter.
On Monday, Trump made it clear that he intends to use tariffs freely to persuade other governments to give him what he wants.
Trump has accused China of not doing enough to prevent the export of fentanyl and the ingredients required to produce it. In the executive order he released Saturday, Trump stated that synthetic opioid shipments had decimated American neighborhoods, put a strain on the health-care system, and were the leading cause of death for those aged 18 to 45 in the United States.
It is unclear what efforts the Chinese government has recently taken, if any, to limit the fentanyl trade, beyond its previous law enforcement cooperation with the United States. During his first week in office, Trump called Xi and discussed fentanyl.
During Trump’s first term, China banned fentanyl and began cooperating with the US to apprehend traffickers. In 2023, Xi and President Joe Biden agreed to hold a series of bilateral narcotics talks after meeting in Woodside, California.
A spokeswoman for the Chinese Embassy in Washington stated that China strongly opposes tariffs and believes that any issues or frictions should be resolved through discussion. “There is no winner in a trade war or tariff war, which serves the interests of neither side nor the world,” according to a spokeswoman.
During his first term, Trump launched an intensive trade war with China after filing a trade case alleging that the country had unfairly infringed on US intellectual property. He increased taxes on China, eventually applying levies to around 60% of the country’s exports to the United States.
Now that Trump has been in office for two weeks, he has launched a new conversation with China.
“This is likely only the beginning of a long process for the two countries to negotiate,” wrote Zhiwei Zhang, president and chief economist of Pinpoint Asset Management, a Hong Kong-based investment firm. “There is hope to deescalate in this process, though the road ahead may be bumpy.”
