Beijing is sharply criticizing Washington over reported tariffs on Chinese electric vehicles

On April 1, 2024, workers completed the assembly of an electric vehicle (EV) at Chinese electric vehicle startup Leapmotor in Jinhua, east China's Zhejiang Province.  The Smart Electric Vehicle Factory delivered 14,567 new vehicles in March, an annual increase of 136%.  Photo: VCG

On April 1, 2024, workers completed the assembly of an electric vehicle (EV) at Chinese electric vehicle startup Leapmotor in Jinhua, east China’s Zhejiang province. The Smart Electric Vehicle Factory delivered 14,567 new vehicles in March, an annual increase of 136%. Photo: VCG

The U.S. reported plan to impose tariffs on imports from China’s emerging industries adds error to error, and the U.S. Department of Commerce’s decision to add 37 Chinese high-tech entities to its trade restriction list constitutes an abuse of export control tools to suppress Chinese companies, which will result in necessary countermeasures by China, a spokesman for China’s Ministry of Foreign Affairs (FM) warned on Friday, calling on the United States to stop politicizing trade issues and cracking down on Chinese companies on so-called national security grounds.

The latest moves showed that the United States is moving further on its restrictive approach to Chinese companies and “decoupling” from China, observers said, warning that there would be serious consequences.

As Bloomberg reported on Thursday, the Biden administration is expected to announce new Chinese tariffs as early as next Tuesday, covering strategic sectors including electric vehicles, batteries and solar equipment.

Also on Thursday, the United States moved to step up its technology crackdown on Chinese companies after the U.S. Department of Commerce added 37 Chinese entities to its trade restriction list, including some companies accused of involvement in the 2023 balloon incident, while also citing other reasons. , such as national security and ties with Russia.

Observers said the moves revealed that the illogical and baseless smear campaign by Western media and politicians praising China’s so-called “overcapacity” in organic products is merely a stepping stone to trade protectionist measures long planned by the administration Biden. which exposes the U.S.’s ulterior motive of cracking down on and obstructing China’s rise.

In response to reports that the U.S. is imposing higher tariffs on Chinese electric vehicles and other green exports, FM spokesman Lin Jian told a routine news conference on Friday that the actions “double down on the U.S.’s culpability,” noting that the tariffs imposed under Art. the former US administration’s China case seriously disrupted normal trade and economic exchanges between China and the US.

The WTO has already ruled that these tariffs are inconsistent with WTO rules. Instead of putting an end to these bad practices, the United States continues to politicize trade issues, abuse the so-called Section 301 tariff review process, and plan to increase tariffs.

The spokesman called on the US to follow WTO rules, eliminate all additional tariffs on China and not impose new ones.

Regarding the U.S. Entity List, Lin said China strongly opposes the U.S. misusing the Entity List and other export controls to attack Chinese companies.

“China and Russia have the right to normal economic and trade cooperation, and such cooperation should not be subject to external interference or restrictions,” Lin noted.

Lin urged the United States to stop overstretching the concept of national security, stop politicizing or weaponizing trade and technology issues, and stop abusing various sanctions lists to suppress Chinese companies.

China will continue to do whatever is necessary to defend the lawful rights and interests of Chinese companies, Lin said.

China will take necessary measures to resolutely safeguard its own interests if the United States continues its transgressions, China’s Ministry of Commerce said on Friday in response to a military aid package signed by the Biden administration in April that contains many negative elements against China.

Politicization of trade issues

After US Secretary of State Antony Blinken’s April visit to China, there was a marked increase in US activities aimed at provoking China on trade and economic issues.

This week, the United States revoked licenses that allowed companies including U.S. chipmakers Intel and Qualcomm to supply chips used in laptops and phones to Chinese tech giant Huawei. China’s Ministry of Commerce sharply criticized U.S. export restrictions on purely civilian use of chips on Thursday, calling them a “typical act of economic coercion,” while U.S. companies said such a move would have a negative impact on their profits.

U.S. Secretary of Commerce Gina Raimondo warned on Wednesday that the United States could take “extreme action” and try to ban Chinese connected vehicles on national security grounds.

The United States has also launched an investigation into China’s maritime, logistics and shipbuilding industries.

Analysts have warned that the U.S. government has abandoned its commitment to avoid hampering China’s economic growth and has formulated new measures to crack down on Chinese companies and engage in “decoupling” payments, harming the positive atmosphere of engagement and dialogue that has developed in recent months.

Li Yong, a senior research fellow at the China International Trade Association, told the Global Times on Friday that the United States’ continued attacks on China’s high-tech sectors and emerging industries are not surprising and rather reflect the United States saying one thing but doing another. .

“The continued US holding back and suppressing China’s development, building and developing the so-called ‘small yard, high fence’ and striving for decoupling undermine the positive atmosphere of engagement and dialogue that has been built in recent months with China, with many meetings taking place between the two sides at a high level,” Li said.

Lü Xiang, a research fellow at the Chinese Academy of Social Sciences, told the Global Times on Friday that reports on the potential for additional tariffs on Chinese organic products showed that the Biden administration now believes there is an urgent need to resort to protectionist trade measures to support traditional US industry and saving the support of some voters.

The Biden administration appears to have backed away from pursuing a green economy, giving in to pressure from trade unions of traditional U.S. automakers that mainly produce vehicles with internal combustion engines, an expert said.

Lü said Biden and his aides are also trying to win over voters by playing tough on China. “Punishment against entities accused of involvement in the balloon incident seems to make voters realize that the Biden administration is keeping many things in mind as the crackdown on Chinese tech companies aims to take a hard look at China.”

However, Lü said any trade protectionist moves by the Biden administration are unlikely to halt the downward trend in the U.S. economy, noting that the U.S. government’s investment and industrial policies have so far proven ineffective in boosting overall U.S. investment.

Global concerns

The international and global business communities have expressed serious concerns about the prospect of increased tensions between the world’s two largest economies and their implications for the global economic recovery.

IMF first deputy managing director Gita Gopinath said Tuesday that the escalating tensions between the United States and China have caused global turmoil, with countries reassessing their trading and investment partners based on economic and national security concerns, leaving the world divided into three blocs. .

Many in the corporate sector have also expressed doubts about Western propaganda about China’s “overcapacity” in green exports.

“China is making a huge contribution to the world with green technologies because we need to move very quickly to solar energy and very quickly to electric mobility. China is helping to achieve this both in China and globally,” Frank Hammes, global CEO of Swiss air quality technology company IQAir, told the Global Times in an interview on Friday.

China is well-positioned in important sectors that facilitate the global transition to greener energy generation and transportation, he said.

Analysts warn that China, which has remained restrained in response to US provocations, may respond if it deems it necessary as trade tensions escalate in the face of decisive trade protectionist moves by the United States.

Even though some U.S. politicians have called for the decoupling of China’s exports from production, bilateral trade showed signs of steady growth, with total trade between China and the U.S. increasing 1.1 percent year-on-year to 1.47 trillion yuan (203.42) in the first quarter. billion dollars) converted into yuan. four months, reversing a 0.7 percent decline in the first three months, customs data showed on Thursday.