Keeping good on its promise to respond to any U.S. tariffs with measures of its own, China has added tariffs to 128 American products. It’s become a tit-for-tat in trade between the two nations.
China’s Ministry of Commerce said Friday that Trump’s steel and aluminum tariffs, specifically, “violated the relevant WTO rules,” and that, “It actually constitutes a safeguard measure and constitutes a serious violation of China’s interests.”
The U.S. issued 25 percent tariffs on foreign steel imports and 10 percent on aluminum—which took effect Friday—under Section 232 of the Trade Expansion Act of 1962, which allows President Trump to put tariffs in place because imports of the metals have been a threat to U.S. national security. China said, however, that the tariff measures do not meet the WTO’s security exceptions requirement that would allow Trump to circumvent the WTO’s restrictions on tariffs.
As such, China will levy roughly $3 billion worth of taxes on U.S. products, which will impose 15 percent tariffs on some products, like fresh fruit, wine and steel pipes, and 25 percent on other products, like pork and recycled aluminum. Though seemingly arbitrary, the items targeted are likely to hurt U.S. farmers and those in largely Trump-supporting steel states.
Currently, there are no tariffs aimed at apparel or footwear products in the 128-item list, but China has said it will implement a second part to the list “after further evaluating the impact of the U.S. measures on China.”
“The United States’ practice of restricting the import of products based on ‘national security’ has severely damaged the multilateral trade system represented by the WTO and seriously interfered with the normal international trade order,” China’s Ministry of Commerce statement noted.
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Back on the U.S. side of things Friday, the U.S. Trade Representative, on President Trump’s direction, filed a request for consultations with China at the WTO, to address what it’s calling “China’s discriminatory technology licensing requirements.”
“China appears to be breaking WTO rules by denying foreign patent holders, including U.S. companies, basic patent rights to stop a Chinese entity from using technology after a licensing contract ends. China also appears to be breaking WTO rules by imposing mandatory adverse contract terms that discriminate against and are less favorable for imported foreign technology,” USTR said in a statement.
On Thursday, President Trump signed an order to place as much as $60 billion worth of tariffs on imports from China, which will likely translate to tariffs of 25 percent and up.
The White House hasn’t yet disclosed which imported products will face tariffs, but considering the bulk of what the U.S. imports from China are soft goods—where apparel and footwear could be particularly hard hit—brands and retailers stateside will remain on edge until the USTR issues the list of targeted products expected within two weeks’ time.
China has not formally addressed its response to Thursday’s tariffs, as it’s so far taking a measured approach while it waits to see the impacts of the metal tariffs and what might be possible to handle in high-level conversations.
“We hope that both sides will proceed from the overall interests of China and the United States, focus on each other, focus on cooperation, control differences, and jointly promote the healthy and stable development of China-US economic and trade relations,” the Ministry of Commerce statement said. “China urges the United States to resolve China’s concerns as soon as possible, resolve differences through dialogue and consultation, and avoid harming the overall situation of Sino-U.S. cooperation.”