Response sees 10-15 percent levies on US products, controls on minerals

China will impose additional tariffs ranging from 10 to 15 percent on US products, and launch an anti-monopoly probe into Google Inc, as well as other trade measures amid growing trade tensions with the United States.

An additional 15 percent tariff will be imposed on coal and liquefied natural gas imports from the US, as well as an additional 10 percent tariff on crude oil, agricultural machinery, large-displacement automobiles and pickup trucks, starting on Feb 10, the Customs Tariff Commission of the State Council said on Feb 4.

The move follows a US announcement that it will impose an additional 10 percent tariff on goods imported from China.

The Finance Ministry said the unilateral imposition of tariffs by the US seriously violates the rules of the World Trade Organization, fails to solve the United States’ own problems, and undermines normal economic and trade cooperation between the two countries.

“The additional tariffs announced by China will cast a shadow on a significant number of US companies. Once a US company withdraws from the Chinese market due to tariff pressures, the obstacles in terms of reestablishing a presence can be substantial,” said Zhou Mi, a senior researcher at the Chinese Academy of International Trade and Economic Cooperation.

Zhou added that the attractiveness of the Chinese market remains a powerful draw for US companies, prompting calls for Beijing and Washington to engage in open and constructive discussions and find a path forward that addresses the concerns of the businesses of both sides while upholding the nations’ respective economic interests.

US President Donald Trump told The Wall Street Journal on Feb 3 that he plans to speak with the Chinese leadership soon about tariffs, while also saying that the 10 percent tariffs were just “an opening salvo”.

As trade tensions with the US escalate, China has filed a lawsuit with the World Trade Organization’s dispute settlement mechanism to defend the nation’s legitimate rights and interests. China firmly opposes the US approach and urges Washington to immediately correct its wrong practices, the Ministry of Commerce said on Feb 4.

China has also announced a batch of export control policies on key minerals. The Ministry of Commerce said that since Feb 4, it has added tungsten, tellurium, bismuth, molybdenum and indium-related items to the export control list.

The Commerce Ministry also put US clothing company PVH Corp and biotechnology company Illumina Inc on its unreliable entity list.

“The two companies violate normal market trading principles, interrupt normal transactions with Chinese enterprises, take discriminatory measures against Chinese companies and seriously damage the legitimate rights and interests of Chinese firms,” the ministry said in a statement.

The State Administration for Market Regulation, China’s top market regulator, said on Feb 4 that it has initiated an investigation into US tech giant Google Inc for suspected violations of China’s Anti-Monopoly Law.

Luo Zhiheng, chief economist at Yuekai Securities, said China should resort to effective countermeasures against any tariff threats by the White House, while optimizing domestic policies and anchoring market expectations.

“Based on the experiences gained during the first Trump administration, China can utilize measures such as imposing additional tariffs and export controls to counter trade threats from the US,” Luo said.

Given heightened global uncertainties, China should scale up the intensity of its fiscal and monetary policies and actively expand domestic demand, Luo said.

Contact the writers at zhuwenqian@chinadaily.com.cn