The White House said Thursday it was monitoring China's complaint to the World Trade Organization (WTO) accusing the United States of making "baseless and false allegations" about China's role in the fentanyl trade to justify tariffs on Chinese products.
The complaint was made Wednesday, a day after President Donald Trump raised tariffs on Chinese goods by 10 percent. The White House said the new duties on Chinese goods were aimed at stopping the flow of the opioid fentanyl and its precursor chemicals.
China said it would impose retaliatory tariffs on several American goods starting Feb. 10, including 15 percent duties on coal and natural gas imports and 10 percent on petroleum, farm equipment, high-emission vehicles and pickup trucks. It also immediately imposed restrictions on exports of certain critical minerals and launched an antitrust probe into U.S. tech giant Google.
In a WTO filing , China said the U.S. tariffs were "discriminatory and protectionist" and violated international trade rules. Beijing has asked for consultations with Washington.
China’s request would initiate proceedings in the WTO’s Appellate Body, which has the final say on dispute resolution. A White House official told VOA the administration was monitoring Beijing’s file but did not provide further details.
Analysts say Beijing’s move is largely performative and unlikely to yield much relief. The Appellate Body was largely paralyzed after the Trump administration’s first move in 2019 to block the appointment of appellate judges over what it viewed as judicial overreach. The Biden administration has continued that policy.
China recognizes the WTO won't put much pressure on the United States because Washington is fully capable of blocking any legal process there, said Jeffrey Schott, a senior fellow at the Peterson Institute for International Economics.
"So, I think China's reaction is moderate in showing that they will act appropriately on U.S. trade," he told VOA.
Schott added that there is a “desire to keep things calm” and mitigate the damage, as was the case during the first Trump administration when trade deals were agreed after initial retaliatory trade actions.
On the US side, a 10 percent tariff on China is much lower than the up to 60 percent tariffs Trump promised during his presidential campaign, he said.
Trump-Xi Phone Call
Trump imposed tariffs on Beijing after delaying his move to impose 25 percent tariffs on Mexico and Canada, following Monday's conversation with their leaders. Tariff critics are hoping that talks between Trump and Chinese President Xi Jinping could produce a similar outcome.
White House press secretary Karoline Leavitt said Tuesday that a phone call between the two leaders "is being scheduled and will happen soon."
However, Trump has downplayed the negative impact of China tariffs and said he is in "no rush" to talk to Xi.
"We'll talk to him at the appropriate time," Trump told reporters at the White House on Tuesday.
Unlike Trump's deals with Mexico and Canada, a deal with Beijing is unlikely to happen anytime soon, given strong bipartisan support for imposing tariffs on China over concerns about an influx of illegal drugs and other national security issues, said Rachel Ziemba, an adjunct senior fellow at the Center for a New American Security.
“Even if they make some kind of deal to resolve these particular tariffs or remove the retaliatory tariffs, there will likely be more tariffs on China later in this administration,” he told VOA.
The United States Postal Service (USPS) announced Tuesday that it is suspending acceptance of incoming packages from China and Hong Kong, closing a loophole that Chinese garment companies and other consumer goods companies have used in the past. These companies, including Shein and Temu as well as Amazon vendors, circumvent existing U.S. tariffs by shipping goods directly from China to American customers.
On Wednesday, the USPS reversed its decision, saying it would work with Customs and Border Protection to find a way to collect the new rates.
The Postal Service “will continue to accept all international mail and packages from China and Hong Kong Posts,” he said. “USPS and Customs and Border Protection are working closely to implement efficient collection mechanisms for the new China tariffs to ensure the least disruption to package delivery.”
It is unclear how fees will be collected in direct transactions between Chinese sellers and American buyers.
Trump's trade actions against China, Canada and Mexico, and his threats to impose tariffs on all foreign shipments to the country, including from European allies, have caused confusion and uncertainty in global trade.
Businesses typically respond to trade uncertainty by delaying investment or passing on higher costs to customers. But the damage extends beyond small and large businesses at home and abroad, Ziemba said.
"If one of the goals of the United States is to reduce dependence on China and Chinese supply chains for critical minerals, energy and things like that, then the uncertainty about whether there will be tariffs and investment restrictions on its allies is going to hinder that goal," he said.
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