Tue Feb 04 14:34:50 UTC 2025: ## China Strikes Back at US Tariffs with Countermeasures Targeting Energy and Tech
**Beijing, China** – In swift retaliation to President Trump’s 10 percent tariffs on Chinese goods, China has announced a multifaceted counteroffensive targeting key US sectors. The Ministry of Finance imposed 15 percent tariffs on US liquid natural gas (LNG) and coal, and 10 percent levies on oil, farm equipment, and some automobiles. Simultaneously, the Ministry of Commerce and General Administration of Customs announced export controls on several rare earth minerals and metals crucial to the US tech and green energy industries. These controls, impacting tungsten, tellurium, bismuth, indium, and molybdenum, are designed to “safeguard national security interests,” according to the Ministry.
The measures, effective immediately, come as Trump cited China’s role in the fentanyl crisis as justification for the initial tariffs. While some tariffs are scheduled to begin on Monday, the rare earth restrictions are in immediate effect. This mirrors the tit-for-tat trade war of Trump’s first term, though this response includes not only tariffs but also export controls and potential sanctions against specific US companies, including investigations into Google and potential sanctions for Calvin Klein parent company PVH Corp and biotechnology firm Illumina. Tesla, a Trump ally, could also face tariffs on its electric trucks imported into China.
While China’s retaliatory tariffs target a relatively small percentage (10-12%) of US goods imported into China, the impact on specific sectors could be significant. The rare earth mineral restrictions, in particular, pose a substantial threat to the US tech and clean energy sectors given China’s dominance in their production.
The move comes as Trump also imposed tariffs on Canada and Mexico over immigration concerns. In that instance, after initial threats of retaliation, a 30-day pause was agreed upon after talks between Trump and the respective leaders. Whether similar diplomacy will prevail in the case of China remains uncertain. While some experts suggest a diplomatic solution is possible before a scheduled phone call between Presidents Trump and Xi Jinping, others warn that further escalation is possible if Trump perceives China’s actions as a direct challenge. The situation remains tense, with the potential for further economic disruption depending on the outcome of upcoming negotiations.
First Piper 