China hits back at Trump with reciprocal tariffs, sanctions of US firms
China has revealed the details of its response to new tariffs from the United States on its exports, sanctioning a number of US firms, slapping additional tariffs of 10-15 per cent on selected American goods and announcing plans to bring a case to the World Trade Organization over the matter.
A 15 per cent duty will be applied to imports of US poultry and agricultural products including wheat, corn and cotton, according to a government statement. Tariffs of 10 per cent will be applied to imports of soybeans, pork, beef, fruit, vegetables and dairy.
Beijing’s actions were timed to coincide with the US’ doubling of universal tariffs on Chinese goods, a move announced by US President Donald Trump last week to augment the 10 per cent tariffs in effect since February.
The Ministry of Commerce added 15 US firms – including a number of companies linked to defence and security – to China’s export control list. These companies will need special approval to receive shipments of “dual-use” items, goods that carry both civilian and military applications.
Ten other American firms were added to Beijing’s “unreliable entity list”, effectively banning them from trade with China or making any new investments in the country. These companies were sanctioned for taking part in arms sales to Taiwan or engaging in military cooperation with the island, according to a ministry spokesperson.
On Tuesday, China also launched its first anti-circumvention investigation into US optical-fibre products. The trade probe will examine whether companies are dodging tariffs by altering products or re-routing shipments through third countries.
Another statement from the ministry later in the day said evidence submitted by the applicant suggested that US exporters may have circumvented anti-dumping measures on non-dispersion-shifted single-mode optical fibre by instead exporting cut-off wavelength-shifted single-mode optical fibre to China.
“We find that the application meets the conditions for launching an anti-circumvention investigation and have decided to proceed with the probe,” the ministry said. “We will make an objective and impartial judgment based on the investigation’s findings.”
On the same day, Chinese customs announced an immediate suspension of log and certain soybean imports from the US, citing the need to protect the country’s forestry and agricultural consumers.
China, the major buyer of US soybeans, has revoked export qualifications for three US firms after detecting ergot fungus – which can infect the developing grains of cereals and grasses – and agrochemical coating agents in their shipments.
Chinese customs authorities also said they had detected small woodworm, aspergillus and other quarantine forest pests in imported US logs.
The unilateral tariff measures launched by the United States seriously violate the rules of the WTO
Analysts said that while this round of retaliation has been more expansive than the measures taken in February, its selective nature indicates China is not yet eager to reach the top of the escalatory ladder.
“This round of new additions has thus far avoided the scenario where the key US conglomerates with a heavy reliance on the Chinese market would be targeted,” said Lynn Song, chief China economist at financial services corporation ING.
“It’s possible that if we see a negotiation breakdown, companies on the unreliable entities list could start to face restrictions in their business dealings with China, so this list remains worth monitoring.”
In a post on his Truth Social platform on Monday, Trump appeared ready to continue the tariff blitz. “To the Great Farmers of the United States: Get ready to start making a lot of agricultural product to be sold INSIDE of the United States,” he said. “Tariffs will go on external product on April 2nd. Have fun!”
Beijing will “firmly safeguard” its legitimate rights and interests in accordance with WTO rules, a commerce ministry spokesperson said in an online statement, vowing to defend the multilateral trading system and the international economic and trade order.
“The unilateral tariff measures launched by the United States seriously violate the rules of the WTO and undermine the basis for bilateral economic and trade cooperation.”
“The essence of Sino-US economic and trade relations is mutual benefit,” said Lou Qinjian, spokesman for the current session of the National People’s Congress – China’s top legislature – at a Tuesday press conference preceding the opening of the congress.
“The US’ unilateral imposition of tariffs violates WTO rules and interferes with the security and stability of global industrial and supply chains. It is hoped that the US and China will meet each other halfway and find a solution to the problem through equal consultation.”
Lin Jian, a spokesman for China’s Ministry of Foreign Affairs, was less conciliatory. Beijing will “accompany the US to the very end” if Washington insists on “instigating a tariff war, a trade war, or some other war,” he said.
“We advise the US to put away its bullying attitude and get back on the right track of dialogue and cooperation as soon as possible,” Lin said.
“Pressure, coercion and threats are not the correct way to deal with China. To exert extreme pressure on China would be to make the wrong calculation.”
Zhang Zhiwei, chief economist at Pinpoint Asset Management, said the measures unveiled this week will have more bite than China’s actions in February, as more goods are involved.
“But we need to keep in mind that the US imposed tariffs on all China’s exports, while China retaliated on a small share of US exports. I think China is still trying not to escalate the trade war.”
The US exported a total of US$24.65 billion in farm goods to China in 2024, according to data from the US Department of Agriculture. Though this accounted for 17.2 per cent of total US exports to China, last year’s figure represented a decrease of 15.2 per cent compared to 2023.
Taking all of China’s countermeasures into account, only around a quarter of US exports to the country have been affected by tariffs, according to ING. “Restraint in retaliation keeps negotiation on the table, but the path ahead remains narrow,” Song said.
“Trump’s fresh tariffs are a way to continue to show his base the strongman image he tries to portray. China has to be the adult in the room, and is trying to ensure any retaliation is strategic and measured,” said Bala Ramasamy, an economics professor at the China-Europe International Business School in Shanghai.
“It’s unclear as to why Trump has gone ahead with his second salvo of tariffs on China. It cannot be due to fentanyl or immigrants, as any effort in this direction takes time and requires two-way collaboration. China’s latest moves, meanwhile, are more sensible and made in response to America’s tariffs.”
Additional reporting by Mia Nulimaimaiti