US president Joe Biden has hiked tariffs on a wide range of Chinese goods, citing “unfair competition” from Beijing.
In an announcement by the White House yesterday (14 May), the Biden administration said it had increased tariffs on a number of Chinese imports, citing a need to protect US workers and secure its supply chains.
“[US] workers and businesses can outcompete anyone – as long as they have fair competition. But for too long, China’s government has used unfair, non-market practices,” said Biden.
“China’s forced technology transfers and intellectual property theft have contributed to its control of 70, 80, and even 90 percent of global production for the critical inputs necessary for our technologies, infrastructure, energy, and health care – creating unacceptable risks to America’s supply chains and economic security.”
He added that these same policies added to China’s “growing overcapacity and export surges”, which would harm US workers, businesses and communities.
Tariffs
The tariffs hit a wide variety of sectors, including electric vehicles (EVs), green technology and critical minerals.
Some examples of the rate increases include:
- A rise in tariffs on “certain steel and aluminium products” this year to 25%
- A quadrupling of the tariff on EVs, from 25% to 100%, in 2024
- A doubling of the tariffs on semiconductors, from 25% to 50%, by 2025
- A rise to 25%, up from 7.5%, to batteries and battery parts later this year, with lithium-ion non-EV batteries increasing to 25% by 2026
Medical products - such as rubber gloves, syringes and personal protective equipment - will also see stiff hikes, up to 50% in the case of syringes and needles. Ship-to-shore cranes will also face a new 25% tariff.
According to new data from the WTO, China is the leading exporter of passenger vehicles, with 5.4 million units exported. Of these, roughly a third were EVs.
WTO economists Eric Ng Shing and Roy Santana said:
“[China] exported over 1.5 million battery EVs, meaning that one out of every four battery EVs exported in 2023 originated in China.”
Responses
“China will take resolute measures to safeguard its own rights and interests,” the Chinese ministry of commerce said in a statement.
“The US should immediately correct its wrong actions and cancel the additional tariff measures against China.”
CEO of Stellantis, Carlos Tavares, accused Biden of “very strong protectionism”, saying that tariffs would push up the price of vehicles for consumers.
Stellantis, which owns Vauxhall, launched a partnership with Chinese company Leapmotor to import cheap EVs into the UK and Europe on the same day that the US announced its tariff plan.
Opposition Republican senator Marco Rubio called the tariffs a “misguided, half-solution” and called for them to be extended onto non-electric vehicles.
Political moves
Biden’s moves come as he ramps up his political campaign ahead of the 2024 US presidential election.
His likely opponent, former Republican president Donald Trump, has pledged even higher tariff rates on Chinese imports, as high as 60%, and said he would also raise tariffs on all imports to 10%. The current rate for most goods is 3%.
Trump, who is seeking to be the first president to win non-consecutive terms since Grover Cleveland, is also likely to strip out many parts of Biden’s domestic agenda, while legislation such as the CHIPS Act or Inflation Reduction Act is predicted to continue to be implemented if Biden wins re-election.
