china-rolls-back-tariffs-on-some-us-made-semiconductors

China has waived its 125 per cent retaliatory tariffs on certain semiconductor imports from the US, reports said on Friday.

 

The reports from the Chinese Ministry of Commerce said at least eight integrated circuit (IC)-related tariff codes were exempted from levies imposed earlier this month in response to US President Donald Trump’s tariffs on Chinese products. However, China has maintained tariffs on memory chips.

 

China’s customs department authorities also informed domestic companies on Thursday that any duties paid for any exempted semiconductor imports from April 10 to 24 would be eligible for refunds, as per the report.

 

China’s customs authorities have not issued any public notice regarding this change. Multiple phone calls to the news office of China Customs on Friday morning went unanswered. Meanwhile, the authorities from the Semiconductor Industry Association have not responded to the claims made in the report.

 

In Hong Kong, shares of Semiconductor Manufacturing International Corporation, the largest semiconductor foundry in mainland China, fell 1.3 per cent on Friday morning, while Hua Hong Semiconductor, China’s second-largest foundry, slid 4.4 per cent. In contrast, the Hang Seng Tech Index gained nearly 1.9 per cent.

 

If confirmed, China’s tariff waivers could signal an easing of the trade war between the world’s two largest economies, as well as Beijing’s intent to reduce disruptions in the semiconductor supply chain. China imported US$88 billion worth of ICs in the first quarter of this year, up 3.2 per cent from a year earlier, according to customs data.

 

On April 12, China imposed 125 per cent tariffs on all US imports in retaliation for the trump administration’s reciprocal tariffs.

 

On April 11, China clarified its customs rules, stating that the origin of semiconductors would be determined by the location of wafer fabrication, the Post reported at the time. That means only chips manufactured in the US will incur additional tariffs, while US-designed chips produced elsewhere will remain exempt.