From tariffs to rare earth export restrictions and port fees – US-China diplomatic ties have turned sour once again. Following US President Donald Trump’s announcement to levy an additional 100 per cent tariff on Chinese imports from November 1, a defiant China has vowed to stand firm against his threats.
On Sunday, Beijing signalled that it would not back down in the face of Trump’s tariff threats, saying its stance is “consistent”.
“We do not want a tariff war, but we are not afraid of one,” the Chinese commerce ministry said in a statement posted online. It added, however, that differences could only be resolved through negotiations, and not threats.
“Frequently resorting to the threat of high tariffs is not the correct way to get along with China,” the post said, which was presented as a series of answers from an unnamed spokesperson to questions from unspecified media outlets.
Calling for addressing any concerns though dialogue, the post warned that “if the US side obstinately insists on its practice, China will be sure to resolutely take corresponding measures to safeguard its legitimate rights and interests”.
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Both sides accuse the other of violating the spirit of a truce reached earlier by imposing new restrictions on trade. Trump claimed China is “becoming very hostile” and that it’s holding the world captive by restricting access to rare earth metals and magnets.
China’s new regulations require foreign companies to get special approval to export items that contain even small traces of rare earths elements sourced from China. These critical minerals are needed in a broad range of products, from jet engines, radar systems and electric vehicles to consumer electronics including laptops and phones.
China, which accounts for nearly 70 per cent of the world’s rare earths mining and controls roughly 90 per cent of global rare earths processing, said the export licenses would be granted for legitimate civilian uses, noting that the minerals also have military applications.
The back and forth has threatened to derail a possible meeting between Trump and Chinese leader, Xi Jinping, and put an end to a truce in a tariff war in which new tariffs from both sides briefly topped 100 per cent in April.
Trump has been on a tariff-imposing spree this year, slapping high duties on products from most US trading partners. Those who engage in negotiations to reduce tariffs are allowed some concessions. So far, China has been one of few to not back down in the face of high US tariffs, having a wide export basket that it can rely on.
The Chinese commerce ministry’s post also mentions several new restrictions that the US has imposed in recent weeks, including going forward with new port fees on Chinese ships that take effect Tuesday. In retaliation, China announced on Friday that it would impose port fees on American ships.
Additionally, the US is also expanding the number of Chinese companies subject to US export controls, the Chinese ministry’s post stated.
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