China returns with a limited response to Donald Trump’s rates

Beijing has taken reprisals against Donald Trump’s tariffs on China imports with their own tariffs, but limited their scope in a possible attempt to avoid a complete commercial war.

Measures against US products ranging from liquefied natural gas to cars will enter into force on February 10. They were announced on Tuesday, hours after the new additional rate of the president of the United States of 10 percent on Chinese products came into force.

Beijing also said he would launch an antimonopoly probe on Google, whose search engine is blocked in China.

Beijing’s new rates point to approximately $ 14 billion of goods, said Citigroup analysts, less than 10 percent of the total imports of the United States in 2023, last year for which there were complete data.

The measure was “not a staggered response,” said Chris Beddor, deputy director of Research from China of Givkal. “They are clearly pointing to negotiations and an agreement.”

Trump baffled allies and investors on Friday by announcing taxes on Canada, Mexico and China, who accused of not stopping immigration and flow of the mortal opioid fentanyl in the United States.

Beijing has taken some measures to stop the flow of ingredients for fentanyl, known as precursor chemicals, since former President Joe Biden and China’s leader, Xi Jinping companies that do the precursors.

Trump has maintained his campaign promise to impose 60 percent tariffs on Chinese exports to the United States. People familiar with the situation said they want to make an agreement with Beijing, so he chose to hit China initially with a lower rate.

The commercial relationship between the United States and China has shaped the economies of both countries in recent decades. But Beijing’s participation in total imports in the United States has fallen significantly since Trump presented tariffs in his first term in office.

China’s latest measures against the United States will impose tariffs between 10 % and 15 percent in the US LNG., Coal, crude oil and agricultural equipment. Beijing will also impose tariffs on some imports of cars from the US and additional export controls in five rare metals.

Trump is expected to speak with XI in the next few days, which causes hope that the two leaders can make an agreement to avoid a complete commercial war between the two largest economies in the world.

In response to Chinese retaliation, the spokesman for the White House National Security Council, Brian Hughes, said: “President Trump is committed to saving American life by using his authority to end the Fentanyl flow on our borders of the South and the north that originates in China. It is about prioritizing the national security and security of Americans. “

Hong Kong Hang Seng index, which had increased up to 3.3 percent in early trade, showed some of its profits to close 2.7 percent, while the RenminBi on the high seas was slightly strengthened to RMB7. 32 and oil prices decreased approximately 1 percent.

Beijing’s initial retaliation was a “more symbolic movement,” said Oxford Economics analysts, and added the decision amounted to an increase in the weight rate weighted rate of 2 percentage points in US imports.

The Beijing antimonopoolio regulator announced Google research for suspicion of violations of the laws against monopoly on Tuesday. Although the search engine is blocked in China, along with most companies of the Alphabet parent company, the US group won the Chinese companies that announce abroad.

The Chinese phonemes also widely use their Android operating system, a long -standing frustration point for the country’s officials, who broke into the US software control that supports most smartphones.

During Trump’s first administration, Washington blocked Huawei of the Google software ecosystem, damaging the smartphone of the Chinese national champion outside his local market.

Referring to the movements of Washington and Beijing this week, Louise Loo, Chinese main economist in Oxford Economics, wrote in a note that “the commercial war clearly (s) in the early stages.”

Trump put his tariffs against Canada and Mexico waiting for a month after last minute conversations on Monday with Canadian Prime Minister Justin Trudeau and Mexican president Claudia Sheinbaum.

China’s Ministry of Finance said that American tariffs violated the rules of the World Trade Organization. “It is not only useless to solve their own problems, but also undermines normal economic and commercial cooperation between China and the United States,” he said when announcing the new rates.

The Ministry said that US exports and LNG of the US would face an additional 15 percent tariff, while crude oil, agricultural machinery, cars and collections would receive a 10 percent rate.

China was the second largest; USA.

The country represented 2.9 percent of the US natural gas exports from January to November 2024, according to EIA figures.

The Chinese Ministry of Commerce also announced on Tuesday export controls in Tungsten and more than two dozen other products and technologies of rare metals, starting immediately.

Goldman Sachs analysts described China as a “dominant producer” of metals subject to controls, adding “critical minerals (they were) a source of increasingly important leverage.”

The bank said Beijing blocked the exports of several other key minerals in December, a movement that hit the US semiconductor industry.

China also expanded on Tuesday its “List of unreliable entities”, a blacklist national security, adding the American biotechnology group Illumina and PVH Group, an American clothing manufacturer whose brands include Calvin Klein and Tommy Hilfiger.

The Ministry had previously investigated PVH for alleged discrimination against Xinjiang cotton, the western region where Chinese authorities are accused of human rights abuses, including forced labor.

Additional Zijing Wu reports on Hong Kong