In a swift response to the United States' imposition of 10% tariffs on Chinese goods, China has declared new tariffs of up to 15% on select U.S. products. These measures were announced shortly after the U.S. tariffs took effect on Tuesday.

Details of China's Tariffs

The Chinese Ministry of Finance criticized the U.S. action, stating, "The U.S.'s unilateral tariff increase seriously violates the rules of the World Trade Organization. It is not only unhelpful in solving its own problems, but also damages normal economic and trade cooperation between China and the U.S."

In retaliation, China will implement the following tariffs starting February 10:

15% Tariff: Applied to coal and liquefied natural gas (LNG) imports from the U.S.
10% Tariff: Targeting crude oil, agricultural machinery, large-displacement vehicles, and pickup trucks.

Despite being the world's largest LNG importer, China's reliance on U.S. LNG is minimal, with primary supplies coming from Australia, Qatar, and Malaysia. In 2023, U.S. LNG exports to China accounted for approximately 2.3% of total U.S. natural gas export volumes, according to the U.S. Energy Information Administration.

China's Legal Action

China has also vowed to file a legal complaint against the U.S. at the World Trade Organization (WTO) over the new tariffs. However, this move is largely symbolic, as the WTO's dispute settlement system has been effectively non-functional since 2019, following the U.S.'s blocking of judge appointments during a previous tariff dispute with China.

Global Reactions and Developments

The U.S. dollar experienced a rally following the implementation of the tariffs, leading to a decline in the Chinese yuan and the Australian dollar. The Canadian dollar and Mexican peso also saw decreases, despite recent agreements with the U.S. to delay tariffs.

In Europe, leaders have expressed concerns over potential trade conflicts with the U.S. Friedrich Merz, Germany's chancellor hopeful, emphasized the importance of European unity in addressing challenges posed by U.S. trade policies. "We've experienced all of this before," Merz told DW, referencing past U.S. tariffs on European steel and aluminum. He remains optimistic that Europe can "solve" the challenges presented by the current U.S. administration.

Looking Ahead

As tensions escalate, global markets and international relations are closely monitoring the developments between the U.S. and China. The effectiveness and repercussions of these tariffs remain to be seen, with potential impacts on global supply chains and economic stability.