Please ensure Javascript is enabled for purposes of website accessibility

Prime Minister of Yemen’s Houthi Government Killed in Israeli Strike

2 days ago

Texas Gov. Greg Abbott Signs Law Redrawing Congressional Maps

3 days ago

US Air Force will Offer Military Funeral Honors to Slain Capitol Rioter

3 days ago

US Republican Senator Joni Ernst Will Not Run for Re-Election, CBS News Reports

3 days ago

Wall Street Falls as Dell, Nvidia Drive Tech Losses

3 days ago

US Denies Visas to Palestinian Officials Ahead of UN General Assembly

3 days ago

Minneapolis Children Revealed Courage, Absorbed Fear During Church Shooting

4 days ago

Ford Recalls Nearly 500,000 Vehicles Over Brake Fluid Leak

4 days ago

Fresno-Bound Passenger Says Delta Attendant Slapped Him, Seeks $20M

4 days ago
Biden Boosts Tariffs on Chinese Goods, Adding to Beijing Tensions
gvw_ap_news
By Associated Press
Published 1 year ago on
May 14, 2024

The Biden administration's imposition of new tariffs on Chinese goods, including electric vehicles and solar cells, amid a contentious election year reflects heightened trade tensions, global economic concerns, and strategic efforts to counter China's market dominance in emerging technologies. (AP File)

Share

Getting your Trinity Audio player ready...

WASHINGTON — The Biden administration announced plans to slap new tariffs on Chinese electric vehicles, advanced batteries, solar cells, steel, aluminum and medical equipment — an election year move that’s increasing friction between the world’s two largest economies.

The tariffs come in the middle of a heated campaign between President Joe Biden and his Republican predecessor, Donald Trump, in which both candidates are vying to show who’s tougher on China.

Chinese Government Push Back

The Chinese government was quick to push back, issuing a statement Tuesday that the tariffs “will seriously affect the atmosphere of bilateral cooperation.” The foreign ministry used the word “bullying”

The tariffs are unlikely to have much of an inflationary impact because of how they’re structured. Administration officials said they think the tariffs won’t escalate tensions with China, yet they expect China will explore ways to respond to the new taxes on its products. It’s uncertain what the long-term impact on prices could be if the tariffs contribute to a wider trade dispute.

The tariffs are to be phased in over the next three years, with those that take effect in 2024 covering EVs, solar cells, syringes, needles, steel and aluminum and more. There are currently very few EVs from China in the U.S., but officials worry low-priced models made possible by Chinese government subsidies could soon start flooding the U.S. market.

Chinese firms can sell EVs for as little as $12,000. Their solar cell plants and steel and aluminum mills have enough capacity to meet much of the world’s demand, with Chinese officials arguing their production keeps prices low and would aid a transition to the green economy.

Tariffs to Stop China From Dominating Market

Lael Brainard, director of the White House National Economic Council, said the tariffs will raise the cost of select Chinese goods and help thwart Beijing’s efforts to dominate the market for emerging technologies in ways that pose risks to U.S. national security and economic stability.

“China is simply too big to play by its own rules,” Brainard told reporters on a Monday call previewing the announcement.

Administration officials have stressed the decision on tariffs was made independently of November’s presidential election. But Brainard noted in her remarks the tariffs would help workers in Pennsylvania and Michigan, two of the battleground states that will decide who wins the election.

But China’s commerce ministry said in a statement the that the tariffs were “typical political manipulation” as it expressed its “strong dissatisfaction” and pledged to “take resolute measures to defend its rights and interests.”

Tax Rate on Chinese Imported EVs to Rise

Under the findings of a four-year review on trade with China, the tax rate on imported Chinese EVs will rise to 102.5% this year, up from total levels of 27.5%. The review was undertaken under Section 301 of the Trade Act of 1974, which allows the government to retaliate against trade practices deemed unfair or in violation of global standards.

Under the 301 guidelines, the tariff rate is to double to 50% on solar cell imports this year. Tariffs on certain Chinese steel and aluminum products will climb to 25% this year. Computer chip tariffs will double to 50% by 2025.

For lithium-ion EV batteries, tariffs will rise from 7.5% to 25% this year. But for non-EV batteries of the same type, the tariff increase will be implemented in 2026. There are also higher tariffs on ship-to-shore cranes, critical minerals and medical products.

New Tariff Were Symbolic, at First

The new tariffs, at least initially, are largely symbolic since they will apply to only about $18 billion in imports. A new analysis by Oxford Economics estimates the tariffs will have a barely noticeable impact on inflation by pushing up inflation by just 0.01%.

The auto industry is still trying to assess the impact of the tariffs. But at present, it appears they could be assessed on only two Chinese-made vehicles, the Polestar 2 luxury EV and potentially Volvo’s S90 luxury gas-electric hybrid midsize sedan.

“We’re still reviewing the tariffs to understand exactly what’s affected and how,” said Russell Datz, spokesman for Volvo, a Swedish brand now under China’s Geely group. A message was left seeking comment from Polestar, which also falls under Geely.

The Chinese foreign ministry spokesperson, Wang Wenbin, said the U.S. is trampling on the principles of a market economy and international economic and trade rules.

“It’s a naked act of bullying,” Wang said.

Slowing Chinese Economy

The Chinese economy has been slowed by the collapse of the country’s real estate market and past coronavirus pandemic lockdowns, prompting Chinese President Xi Jinping to try to jumpstart growth by ramping up production of EVs and other products, making more than the Chinese market can absorb.

This strategy further exacerbates tensions with a U.S. government that claims it’s determined to strengthen its own manufacturing to compete with China, yet avoid a larger conflict.

“China’s factory-led recovery and weak consumption growth, which are translating into excess capacity and an aggressive search for foreign markets, in tandem with the looming U.S. election season add up to a perfect recipe for escalating U.S. trade fractions with China,’’ said Eswar Prasad, professor of trade policy at Cornell University.

European Union Worried About Import Tax

The Europeans are worried, too. The EU launched an investigation last fall into Chinese subsidies and could impose an import tax on Chinese EVs.

After Xi’s visit to France last week, European Commission President Ursula von der Leyen warned that government-subsidized Chinese EVs and steel “are flooding the European market” and said, “The world cannot absorb China’s surplus production.’’

Biden’s Democratic administration views China with subsidies of its own manufacturing as trying to globally control the EV and clean-energy sectors, whereas it says its own industrial support is geared toward ensuring domestic supplies to help meet U.S. demand.

“We do not seek to have global domination of manufacturing in these sectors, but we believe because these are strategic industries and for the sake of resilience of our supply chains, that we want to make sure that we have healthy and active firms,” Treasury Secretary Janet Yellen said.

Raising Tensions

The tensions go far beyond a trade dispute to deeper questions about who leads the world economy as a seemingly indispensable nation. China’s policies could make the world more dependent on its factories, possibly giving it greater leverage in geopolitics. At the same time, the United States says it’s seeking for countries to operate by the same standards so competition can be fair.

China maintains the tariffs are in violation of the global trade rules the United States originally helped establish through the World Trade Organization. It accuses the U.S. of continuing to politicize trade issues and on Friday said the new tariffs compound the problems caused by tariffs the Trump administration previously put on Chinese goods, which Biden has kept.

Those issues are at the heart of November’s presidential election, with a bitterly divided electorate seemingly united by the idea of getting tough with China. Biden and Trump have overlapping but different strategies.

Biden sees targeted tariffs as needed to defend key industries and workers, while Trump has threatened broad 10% tariffs against all imports from rivals and allies alike.

Biden has staked his presidential legacy on the U.S. pulling ahead of China with its own government investments in factories to make EVs, computer chips and other advanced technologies.

“We’ve created $866 billion in private-sector investment nationwide — almost a trillion dollars — historic amounts in such a short time,” Biden said last week in Wisconsin. “And that’s literally creating hundreds of thousands of jobs.”

Trump tells his supporters America is falling further behind China by not betting on oil to keep powering the economy, despite its climate change risks. The ex-president may believe tariffs can change Chinese behavior, but he believes the U.S. will be reliant on China for EV components and solar cells.

“Joe Biden’s economic plan is to make China rich and America poor,” he said at a rally this month in Wisconsin.

RELATED TOPICS:

DON'T MISS

What Are Fresno Real Estate Experts Predicting for 2025 and Beyond?

DON'T MISS

First California EV Mandates Hit Automakers This Year. Most Are Not Even Close

DON'T MISS

Fresno County Garnet Fire Grows to 18,748 Acres in Sierra National Forest

DON'T MISS

US Judge Blocks Deportations of Unaccompanied Migrant Children to Guatemala

DON'T MISS

Israel Pounds Gaza City Suburbs, Netanyahu to Convene Security Cabinet

DON'T MISS

Thousands in Australia March Against Immigration, Government Condemns Rally

DON'T MISS

Trump Says He Will Order Voter ID Requirement for Every Vote

DON'T MISS

Greta Thunberg Joins Flotilla Heading for Gaza With Aid

DON'T MISS

Chicago Mayor Says Police Will Not Aid Federal Troops or Agents

DON'T MISS

Post-War Gaza Plan Sees Relocation of Population, ‘Digital Token’ for Palestinian Land: Washington Post

DON'T MISS

Labor Day Quiz: Do You Know What a Knocker-Upper Is?

DON'T MISS

Bulldogs Check All the Boxes in Runaway Win Over Georgia Southern

UP NEXT

US Judge Blocks Deportations of Unaccompanied Migrant Children to Guatemala

UP NEXT

Israel Pounds Gaza City Suburbs, Netanyahu to Convene Security Cabinet

UP NEXT

Thousands in Australia March Against Immigration, Government Condemns Rally

UP NEXT

Trump Says He Will Order Voter ID Requirement for Every Vote

UP NEXT

Greta Thunberg Joins Flotilla Heading for Gaza With Aid

UP NEXT

Chicago Mayor Says Police Will Not Aid Federal Troops or Agents

UP NEXT

Post-War Gaza Plan Sees Relocation of Population, ‘Digital Token’ for Palestinian Land: Washington Post

UP NEXT

Labor Day Quiz: Do You Know What a Knocker-Upper Is?

UP NEXT

Bulldogs Check All the Boxes in Runaway Win Over Georgia Southern

UP NEXT

Judge Blocks Pillar of Trump’s Mass Deportation Campaign

Thousands in Australia March Against Immigration, Government Condemns Rally

17 hours ago

Trump Says He Will Order Voter ID Requirement for Every Vote

18 hours ago

Greta Thunberg Joins Flotilla Heading for Gaza With Aid

18 hours ago

Chicago Mayor Says Police Will Not Aid Federal Troops or Agents

18 hours ago

Post-War Gaza Plan Sees Relocation of Population, ‘Digital Token’ for Palestinian Land: Washington Post

18 hours ago

Labor Day Quiz: Do You Know What a Knocker-Upper Is?

18 hours ago

Bulldogs Check All the Boxes in Runaway Win Over Georgia Southern

1 day ago

Judge Blocks Pillar of Trump’s Mass Deportation Campaign

2 days ago

Classic Cars Will Still Need a Smog Test in California After Lawmakers Reject Jay Leno Bill

2 days ago

Visalia Driver Arrested for DUI After Multiple Crashes and Pedestrian Injured

2 days ago

Fresno County Garnet Fire Grows to 18,748 Acres in Sierra National Forest

A lightning-sparked wildfire, the Garnet Fire, in the Sierra National Forest has burned 18,748 acres in Fresno County and remains at 8% cont...

17 hours ago

Photo: USDA - Forest Service Tanker 40 at Fresno Air Attack Base. The Fresno County Garnet Fire in the Sierra National Forest has burned 18,748 acres and is 8% contained as crews make progress on containment lines while bracing for possible thunderstorms early this week. (Sam Wu/USFS)
17 hours ago

Fresno County Garnet Fire Grows to 18,748 Acres in Sierra National Forest

U.S. flag and Judge gavel are seen in this illustration taken, August 6, 2024. (Reuters File)
17 hours ago

US Judge Blocks Deportations of Unaccompanied Migrant Children to Guatemala

Smoke rises from Gaza after an explosion, as seen from the Israeli side of the border, August 31, 2025. (Reuters/Amir Cohen)
17 hours ago

Israel Pounds Gaza City Suburbs, Netanyahu to Convene Security Cabinet

Demonstrators hold a banner during the 'March for Australia' anti-immigration rally, in Sydney, Australia, August 31, 2025. REUTERS/Hollie Adams
17 hours ago

Thousands in Australia March Against Immigration, Government Condemns Rally

President Donald Trump walks on the grounds of the Trump National Golf Club in Sterling, Virginia, U.S., August 30, 2025. (Reuters/Nathan Howard)
18 hours ago

Trump Says He Will Order Voter ID Requirement for Every Vote

Activists Yasemin Acar, Greta Thunberg and Thiago Avila attend a press conference before the departure of the Global Sumud Flotilla, a humanitarian expedition to Gaza, at the port of Barcelona, Spain August 31, 2025. (Reuters/Eva Manez)
18 hours ago

Greta Thunberg Joins Flotilla Heading for Gaza With Aid

National Guard troops wear gas masks during protests against federal immigration sweeps, in Los Angeles, California, U.S., June 12, 2025. (Reuters File)
18 hours ago

Chicago Mayor Says Police Will Not Aid Federal Troops or Agents

A view of tents sheltering Palestinians displaced by the Israeli military offensive, in Gaza City, August 23, 2025. (Reuters File)
18 hours ago

Post-War Gaza Plan Sees Relocation of Population, ‘Digital Token’ for Palestinian Land: Washington Post

Search

Help continue the work that gets you the news that matters most.

Send this to a friend