Minutes after Donald Trump’s tariffs about China, China came into force on Tuesday, the Chinese government announced its own retaliation tariffs.
China’s tariffs focus on a variety of sectors -technological mains, energy, cars, agriculture and fashion-, but with some concrete objectives. The Chinese Finance Minister has said that it would impose rates of 15% for coal and the US liquid gas and 10% for crude oil, agricultural machinery, large displacement vehicles and trucks. Some high -profile US companies have begun to be investigated or added to black lists.
Some of China’s measures seem to have a limited impact. The United States is the largest liquefied natural gas exporter, but does not export much to China. Nor does he send him much raw, says Anne Stevenson-Yang, co-founder of J Capital Research and writer about China’s economy.
“The other sectors are aimed at concrete states,” said Stevenson-Yang, referring to agricultural and automotive tariffs. “The objective here is a political theater rather than a particular objective.”
But China has also implemented strict import controls to Wolframium, Telurio, Molybdenum and Ruthenium, materials that are essential for advanced technologies, clean energy and national security, according to the National University of Australia.
On a round table this Monday Philip Luck, an economist from the Center for Strategic and International Studies and former state department, highlighted China’s United States dependence on many critical minerals. “Then … they could cause significant damage to our economy.”
China controls much of the world supply of rare earth, fundamental for the transition to clean energy, including about 80% of the world supply of Wolframio and Bismuto. The controls were carried out to “safeguard national security interests,” said the ministry. These controls are likely to have a military purpose.
Luke Adriaans, research analyst at the Project Blue consultancy, told Bloomberg: “The most affected industries include the defense sector, where Wolframium is a crucial material for the manufacture of ammunition.”
Google research
In Technology, Google operations in China are the current objective of an investigation about alleged antitrust infractions, announced on Tuesday by the Chinese Market Regulation Administration.
The reasons were not clear. Google products, including their search engine, are blocked in China, although they work with local partners. In 2011, Google left his search engine in Chinese in the continental Chinese territory and transferred him to Hong Kong. For 2014, China had blocked the last access road to Google’s email service, Gmail.
It has also been put in the spotlight to Illumina Inc., a biotechnology company specialized in genomic sequencing recently associated with NVIDIA – which last year was the subject of antitrust research, apparently in retaliation – in the field of artificial intelligence technology Health related. On Tuesday, the company was included in the list of non -reliable entities of China, which means that it is likely to face fines and restrictions on sales and investments in China.
The announcement of the China Department of Commerce did not contribute details, only accused the company of “violating the usual commercial principles of the market, interrupted normal transactions with Chinese companies, adopted discriminatory measures against Chinese companies and seriously damaged legitimate rights and interests of Chinese companies ”.
It is said that China represents between 8.5% and 10% of Illumina’s income.
“These are important American companies, but not the most critical in terms of the interests of the United States in China,” he explains to ‘The Guardian’ Icharia Carrozza, senior researcher at the Peace Research Institute of Oslo (Prio). “I would suspect that China wants to indicate its ability to retaliate without climbing the commercial war at a more harmful level.”
The incorporation to the entity list of the American PVH Group clothing company, owner of brands such as Tommy Hilfiger and Calvin Klein, seemed to have a clearer narrative.
The Ministry had already initiated an investigation in September, exploring the inclusion of the company in the list for accusations of “discrimination against Sinkiang” when refusing to use cotton in the region. Many companies have stopped supplying sinkiang cotton, where there are accusations of forced labor against the ethnic minority Uigur. In 2019, PVH added Sinkiang to his “restricted jurisdictions policy.” “We do not produce finished goods in Sinkiang and prohibit the holders of our licenses to do it,” he said.
However, it is not yet clear why PVH – which obtained only 6% of its income in 2023 for sales in China – has been a specific objective, since many companies have retired their Sinkiang supply chains, especially after The approval of the Law of Forced Labor Uigur of 2021, which generally prohibits the importation of Sinkiang products to the United States.
Carozza said it was difficult to know what the real reason was behind any of the options, but that it seemed that, in some way, China was containing the fire a bit. The fact of going after industries or more critical financial institutions could have triggered more severe responses and interrupted the supply chains on which China also depends.
“In this way, Beijing can exert pressure on the United States without triggering uncontrollable economic confrontation.”
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