China Imposes Limited Tariffs After Trump Announces New Taxes

China has imposed selective tariffs on U.S. imports today and issued warnings to major corporations, including Google, over potential sanctions.

The latest move is in response to broad tariffs imposed by President Donald Trump on Chinese imports.

Beijing’s limited retaliation against Trump’s 10 percent tariff on all Chinese imports highlights China’s strategic approach to encourage negotiations with Trump and avoid a full-scale trade war between the world’s two largest economies.

Capital Economics, a UK-based research firm, estimated that China’s additional tariffs would apply to approximately $20 billion (RM88.86 billion) worth of annual imports. In comparison, $450 billion (RM1.99 trillion) worth of Chinese goods are now subject to U.S. tariffs, which took effect at 12:01 AM local time on Tuesday.

“This is a relatively moderate response, at least compared to the U.S. measures, and is designed to send a message to Washington,” said Julian Evans-Pritchard, Chief China Economist at the firm.

Earlier today, Trump announced that he would delay tariffs on Mexico and Canada after discussions with the leaders of both countries—just hours before the measures were set to take effect.

According to a White House spokesperson, Trump plans to contact Chinese President Xi Jinping later this week.

China’s newly announced measures, which coincide with Trump’s tariffs, include a 15 percent levy on U.S. coal and liquefied natural gas (LNG), as well as a 10 percent tariff on crude oil, agricultural equipment, certain small trucks, and large-engine sedans imported from the U.S.

Additionally, China has launched an anti-monopoly investigation into Alphabet Inc., the parent company of Google.

China has also listed PVH Corp, the parent company of brands like Calvin Klein, and U.S. biotech firm Illumina, as potential targets for sanctions.

In another development, China announced it would impose export controls on certain metals, including tungsten, which is crucial for electronics, military equipment, and solar panels.

China’s 10 percent tariff on imported electric trucks from the U.S. could potentially impact Tesla’s Cybertruck, a model Elon Musk has actively promoted in China. However, Tesla has not commented on the matter.

China’s new tariffs will not take effect until February 10, allowing time for Washington and Beijing to reach an agreement—a move that Chinese policymakers hope to achieve with Trump amid China’s slowing domestic demand.