16.05.2024, 13:37 60961

Translation: U.S. President Biden to Increase Tariffs on Chinese Electric Vehicles

U.S. President Biden will announce an increase in tariffs on Chinese electric vehicles from 25% to 100%, effectively barring Chinese electric vehicles from entering the U.S. market. At the same time, he will also announce significant tariff increases on Chinese minerals, solar energy, and batteries. This move undoubtedly sets almost insurmountable barriers for Chinese electric vehicles entering the U.S. market and strongly indicates the intention to limit China's global influence in this rapidly growing sector.

This decision is not limited to the electric vehicle sector but also encompasses a broader range of industrial and energy products. The U.S. government will simultaneously announce significant tariff increases on Chinese mineral resources, solar products, and various types of batteries. These measures appear aimed at undermining China's core competitiveness in the global supply chain, especially considering China's role as a key supplier of raw materials worldwide and its leading position in renewable energy technology.On a deeper level, this move reflects a dual-track trade strategy: on one hand, strictly limiting the export of any technology deemed "sensitive" or "advanced" to China; on the other hand, effectively preventing high-quality, cost-effective Chinese products from entering the U.S. market by imposing high tariff barriers. This strategy not only challenges the principles of international economic cooperation but also signals a potential new wave of tension and uncertainty in the global trade environment.

Before the election, Biden, like Trump, adopted a tariff policy against China, clearly contradicting the long-standing U.S. consensus on free trade. The primary aim is to showcase a tough stance on China to voters. However, amid escalating Sino-U.S. tensions, these measures could trigger broader trade conflicts.

For a long time, the Biden administration has continuously portrayed Chinese products as a so-called "threat," claiming that China is pushing for a "monopoly on key industries" and hyping up the narrative of Chinese "subsidized goods" flooding the U.S. market. As the U.S. implements the Inflation Reduction Act and seeks economic decarbonization, it has also repeatedly accused China of "overcapacity" in the new energy sector. The critical issue the world faces today is not overcapacity in new energy but a severe shortage. The rapid development of China’s new energy industry aligns with economic principles and market laws, rather than being the result of subsidies. It is hoped that relevant countries will maintain an open mindset, genuinely adhere to market economy principles and international trade rules, and provide a fair, transparent, open, and non-discriminatory business environment for Chinese enterprises.

The previous U.S. administration's imposition of Section 301 tariffs on China severely disrupted normal Sino-U.S. economic and trade relations and was ruled by the WTO as a violation of WTO rules. Instead of correcting its erroneous practices, the U.S. continues to politicize trade issues, abusing the so-called Section 301 tariff review procedure to further increase tariffs, which is a mistake compounded.

Moreover, the impact of this U.S. move extends from China to other countries and companies worldwide. The deep restructuring of supply chains, the search for alternative suppliers, and the potential rise in global commodity costs could all be part of the subsequent chain reactions. In the long run, such protectionist measures may prompt countries to pay more attention to maintaining and improving the multilateral trading system, exploring the establishment of a fairer and more inclusive new international trade order. It might even lead to other countries or companies uniting to oppose this U.S. action that undermines WTO rules. The U.S. is undoubtedly positioning itself against global trade, which may seem smart in the short term but is ultimately shortsighted and foolish.

Author: Political scientist Wang Dongbei, China

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