China hit back promptly on Tuesday with new tariffs aimed at American imports in retaliation against the United States’ latest trade blows, adding to a rash of escalations in trade tensions between the world’s two biggest economies. This followed hours earlier when President Donald Trump implemented a 10 per cent tariff on virtually all Chinese imports, effective at midnight ET, constituent parts of which are designed to impede the flow of illegal drugs from China into the United States.
Then, China’s Finance Ministry announced retaliatory tariffs. The country imposed a 15 per cent nickel on U.S. coal and liquefied natural gas (LNG) and a 10 per cent tax on a batch of other American goods, including crude oil, farm machinery, and some trucks and cars. If China’s measures go into effect on February 10, there would be a window for potential negotiations. Trump, meanwhile, was considering talking to Chinese President Xi Jinping to alleviate the growing row.
China also launched an anti-monopoly investigation into Google and added Intel, PVH Corp., the parent company of Calvin Klein, and biotechnology company Illumina to a list of entities at risk of sanctions in addition to the new tariffs. The tightening of US-China trade relations is further worsened by China’s Ministry of Commerce and Customs Administration announcing new export controls on metals needed for the manufacturing of electronics, military equipment and solar panels.
The inclusion of electric trucks in China’s new measures could also impact Tesla’s plans to sell the Cybertruck in China, which the company has been looking to to expand its reach in the country. However, Tesla did not comment on the matter.
China’s punitive actions whip are smaller than the large U.S. tariffs, but they still represent a fairly emphatic response to the trade tussle.
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