As a sign of increasing trade tensions between the U.S. and China, President Biden has announced tariff increases on a range of imports from that country, but most particularly electric vehicle batteries and computer chips.
“We’re not going to let China flood our market,” Biden said in announcing the new tariff policy, remarking that trade with that country “hasn’t been fair.”
The President’s new policy means that tariffs on electric vehicle batteries will be quadrupled to more than 100%, while semiconductor chips will see a tariff doubling of some 50%.
A statement from the White House declared that “for too long, China’s government has used unfair, non-market practices. China’s forced technology transfers and intellectual property theft have contributed to its control of 70, 80, and 90% of global production for the critical inputs necessary for our technologies, infrastructure, energy, and health care.”
A tariff rate increase on some steel and aluminum products, going from around 7% to 25%, has also been announced, as well as a 50% tariff on such medical products as needles and syringes, up from 0%.
Biden followed up on his tariff announcement by focusing on Chinese electric vehicles manufactured in Mexico. “I will put a 200% tax on every car that comes from those plants,” he declared.
The increased tariff announcement has generated a variety of responses, with trade policy expert William Reinsch, writing for the Center for Strategic & International Studies, noting that the new tariffs are “designed to prevent the United States from being swamped with imports that are the product of Chinese overcapacity.”
Notes the National Law Review: “Businesses whose supply chains include goods made in China should assess the implications for their operations and consider strategic adjustments to their supply chains and trade practices.”
Colorado Democrat Governor Jared Polis decried the move, saying it was “horrible news for American consumers and a major setback for clean energy.” Polis added that “tariffs are a direct, regressive tax on Americans and this tax increase will hit every family.”
Concerns that the Chinese government may retaliate in response to the President’s announcement were seen in remarks made by Wang Wenbin, China’s Commerce Minister, who said his country would “take all necessary actions to protect its legitimate rights.”
In published comments, Chinese Foreign Minister Wang Yi additionally characterized tariffs in general as the “most typical form of bullying in the world today,” before adding that the new policy “shows that some people in the U.S. have reached the point of losing their minds in order to maintain their unipolar hegemony.”
By Garry Boulard
Image Credit: Courtesy of the White House
