Trade War Escalates: China Strikes Back at Trump’s Tariffs with Levies and Google Probe
China Hits Back at Trump’s Tariffs with Google Probe and New Trade Restrictions
The ongoing trade conflict between the United States and China took a dramatic turn as Beijing swiftly retaliated against the new U.S. tariffs that came into effect on Tuesday. In response, China imposed duties on American imports and launched an antitrust investigation into Google, escalating tensions between the world’s two largest economies.
China’s Countermeasures
According to Xinhua News Agency, the Chinese government added PVH Corp. (Calvin Klein’s parent company) and gene-sequencing firm Illumina to its “unreliable entity” list, signaling further economic pressure.
Additionally, China has restricted exports of key minerals to the U.S., a move that could impact American industries reliant on these critical resources.
New Tariffs Announced by China
Starting February 10, Beijing will implement:
15% tariffs on U.S. coal and liquefied natural gas (LNG)
10% tariffs on crude oil, agricultural machinery, large-engine vehicles, and pickup trucks
Google Under Antitrust Investigation
Alongside these tariffs, China’s State Administration for Market Regulation (SAMR) announced an antitrust probe into Google, although details remain scarce. While Google services such as Gmail and YouTube are already banned in China, this move adds further regulatory scrutiny on the tech giant.
Market Reactions
Following the announcement, the iShares MSCI China ETF (MCHI) saw gains in intraday trading, along with shares of Alibaba (BABA), JD.com (JD), and PDD Holdings (Temu’s parent company). However, stocks of PVH Corp. and Illumina dropped as a direct response to Beijing’s actions.
Temporary Tariff Exemption for Canada and Mexico
Meanwhile, the U.S. granted Canada and Mexico a temporary 30-day exemption from impending 25% tariffs after both nations pledged to enhance efforts against fentanyl smuggling.
What’s Next? A Renewed Trade War?
Although China’s response was measured compared to President Donald Trump’s broad 10% tariff on all Chinese imports, the ongoing tit-for-tat escalation suggests that tensions are far from over.
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