February 4, 2025. China has announced a new set of retaliatory measures against the U.S., including tariffs on key imports, export controls on critical minerals, and regulatory actions targeting American companies. These measures are in response to the recent 10% U.S. tariffs on Chinese goods and are set to take effect next Monday.
Key Tariffs on U.S. Goods:
Starting next Monday, China will impose:
- 15% tariffs on coal and liquefied natural gas (LNG) imports.
- 10% tariffs on crude oil, agricultural machinery, and large-engine vehicles.
China’s State Council Tariff Commission stated that the U.S. tariff increases violate WTO rules and will negatively impact global trade cooperation.
Export Controls on Critical Minerals:
China has expanded its export controls on materials essential for high-tech production, including:
- Tungsten, tellurium, bismuth, molybdenum, and indium, all of which are classified as critical minerals by the U.S. Geological Survey.
- These restrictions follow previous controls on gallium, germanium, and graphite, which are crucial for semiconductor and battery production.
- Analysts warn that these restrictions could significantly impact U.S. supply chains and national security.
Regulatory Action Against U.S. Companies:
- Antitrust Probe into Google: China’s State Administration for Market Regulation has launched an investigation into Google over potential violations of antitrust laws. While not explicitly linked to tariffs, the announcement came just as the new U.S. tariffs took effect.
- “Unreliable Entities” Designation: China has placed PVH Group (owner of Calvin Klein and Tommy Hilfiger) and biotech firm Illumina on its Unreliable Entities List. This could ban them from China-related import/export activities and new investments in the country.
What This Means for Businesses:
- Increased costs for U.S. businesses importing affected goods from China.
- Potential supply chain disruptions for industries reliant on Chinese minerals and materials.
- Regulatory risks for U.S. companies operating in China.
Next Steps & How Buckland Can Help:
We recommend businesses assess their supply chain exposure to these new measures and explore potential alternatives. Buckland is available to assist with trade compliance strategies, tariff classification, and alternative sourcing solutions.
For more information or assistance, please contact us.