China has announced a series of retaliatory measures against the tariffs imposed by the US, marking an escalation in the ongoing trade war between the world’s two largest economies.
The Chinese countermeasures include the imposition of an additional tariff of 34% on all US goods, effective from 10 April, and export restrictions on certain rare earth elements, reported Reuters.
Go deeper with GlobalData
The Chinese Finance Ministry has criticised the US move as a “typical unilateral bullying practice” and not in accordance with international trade rules, stating that it “seriously undermines China’s legitimate and lawful rights and interests”.
This comes after US President Donald Trump increased tariffs on Chinese goods by 34%, raising the total new tariffs on China this year to 54%.
The new Chinese tariffs are in addition to the 10–15% levies imposed on select US agricultural and energy products earlier this year.
China has also placed export controls on certain medium and heavy rare earths including dysprosium, gadolinium, lutetium, samarium, scandium, terbium and yttrium, which are crucial for various industries including defence and technology.
The export controls took effect on 4 April.
China added 16 US entities to its export control list, blocking the export of dual-use items to those companies. This includes 15 companies from the defence and aerospace sectors, as well as the Coalition for a Prosperous America, a group that previously supported US economic decoupling from China.
An additional 11 US companies were placed on China’s “unreliable entity” list, giving Beijing the right to impose penalties such as bans and fines. The targeted companies include Skydio and BRINC Drones for supplying arms to Taiwan, which China considers part of its territory.
The Chinese yuan has weakened to its lowest level in seven weeks, and stock markets have fallen following the announcement of Trump’s reciprocal tariffs, reported the news agency.
The US President had also tasked the US Trade Representative to review China’s adherence to the 2020 “phase 1” US-China trade agreement by 1 April. The deal, which China has not fully met due to the Covid-19 pandemic, required Beijing to increase its purchases of US exports by $200bn over two years.
Last month, President Trump invoked emergency powers to boost domestic output of critical minerals, aiming to cut reliance on foreign sources, especially China.
