China Retaliates against Trump Tariffs

By Staff, Agencies

In a swift response to new US duties on Chinese goods, China imposed tariffs on some US imports, raising the stakes in a showdown between the world's top two economies even as President Donald Trump offered reprieves to Mexico and Canada.

Additional 10% tariff across all Chinese imports into the US came into effect at 12:01 a.m. ET on Tuesday after Trump repeatedly warned Beijing it was not doing enough to halt the flow of illicit drugs into the United States.
Within minutes, China’s Finance Ministry said it would impose levies of 15% for U.S. coal and LNG and 10% for crude oil, farm equipment and a the small number of trucks as well as big-engine sedans shipped to China from the United States.

China also said it was starting an anti-monopoly investigation in Alphabet Inc's (GOOGL.O), opens new tab Google, while including both PVH Corp (PVH.N), opens new tab the holding company for brands including Calvin Klein, and U.S. biotechnology company Illumina (ILMN.O), opens new tab on a list for potential sanctions in China.

Separately, China's Commerce Ministry and its Customs Administration said it is imposing export controls some rare earths and metals that are critical for electronics, military equipment and solar panels.

A 10%-duty China announced on electric trucks imported from the United States could apply to future sales for Elon Musk's Cybertruck, a niche offering Tesla (TSLA.O), opens new tab has been promoting in China. Tesla had no immediate comment.

China's new tariffs on the targeted US exports will start on Feb. 10, giving Washington and Beijing some time to try and reach a deal that Chinese policymakers have indicated they hope to strike with Trump.

China's counter measures were limited in scope compared to the Trump administration's across-the-board tax on imports, a continuation of Beijing's more measured response to this round of trade tensions with the United States.

Trump plans to speak to Chinese President Xi Jinping later in the week, a White House spokesperson said.

Trump on Monday suspended his threat of 25% tariffs on Mexico and Canada at the last minute, agreeing to a 30-day pause in return for concessions on border and crime enforcement with the two neighboring countries.

During his first term in 2018, Trump initiated a brutal two-year trade war with China over its massive US trade surplus, with tit-for-tat tariffs on hundreds of billions of dollars’ worth of goods upending global supply chains and damaging the world economy.

There was relief in Ottawa and Mexico City after both Canadian Prime Minister Justin Trudeau and Mexican President Claudia Sheinbaum said they had agreed to bolster border enforcement efforts in response to Trump's demand to crack down on immigration and drug smuggling. That would pause 25% tariffs due to take effect on Tuesday for 30 days.

Canada agreed to deploy new technology and personnel along its border with the United States and launch cooperative efforts to fight organized crime, fentanyl smuggling and money laundering.

Mexico agreed to reinforce its northern border with 10,000 National Guard members to stem the flow of illegal migration and drugs.

"As President, it is my responsibility to ensure the safety of ALL Americans, and I am doing just that. I am very pleased with this initial outcome," Trump said on social media.

Canadian industry groups, fearful of disrupted supply chains, welcomed the pause.