China Responds to US Tariffs with Its Own Tariffs and Investigation into Google

China has retaliated against US President Donald Trump's tariffs on Chinese goods by imposing its own tariffs on certain imports from the US on Tuesday. In addition to higher tariffs, Beijing also announced an investigation into Google and the suspension of exports of critical materials for the tech industry.

China has set a 15% tariff on coal and liquefied natural gas, and a 10% tariff on crude oil, agricultural machinery, and large-engine vehicles imported from the US. These tariffs will take effect next Monday and are higher than those imposed by Trump on Chinese imports.

China's Ministry of Finance stated that the US’s unilateral tariff hikes are in violation of World Trade Organization (WTO) rules. "This move not only fails to resolve the internal issues of the US but also undermines the normal economic and trade cooperation between China and the US," the ministry said in its statement.

In addition to the tariffs, China's State Administration for Market Regulation announced on Tuesday that it is investigating Google for alleged violations of antitrust laws. This announcement came just minutes after Trump’s 10% tariff on Chinese goods took effect.

The tariffs on Canadian and Mexican products also took effect on the same day, although Trump agreed to delay his 30-day threat against both countries after they acted to address his concerns over border security and drug trade. Trump is expected to speak with Chinese President Xi Jinping in the coming days.

In addition to the tariffs, China has announced export controls on several critical elements used in high-tech production, including tungsten, tellurium, bismuth, molybdenum, and indium. These minerals are important to the US economy and national security, as their supply chains are vulnerable to disruption.

This export control is an extension of the measures China implemented in December on essential elements such as gallium used in manufacturing.

The Chinese Ministry of Commerce has also placed two US companies on its unreliable entity list: PVH Group, which owns Calvin Klein and Tommy Hilfiger, and Illumina, a biotechnology company based in China. These companies are banned from engaging in import or export activities related to China and from making new investments in the country.

Why Trump Targets China

According to Time Magazine, Trump accused China of allowing the production of fentanyl, which is then made into pills in Mexico and smuggled into the US, contributing to around 70,000 overdose deaths annually. Trump has argued that imposing tariffs on imports from China is a way to pressure Beijing into addressing this issue more seriously.

However, China has denied the allegations, with the Ministry of Foreign Affairs stating that the US should take responsibility for the fentanyl problem rather than "threatening other countries with arbitrary tariff increases." “The United States needs to view and resolve the fentanyl issue in an objective and rational manner,” the statement said. China also claims to be one of the toughest countries in the world in terms of drug enforcement, both in policy and implementation.

Experts note that China executes several individuals each year for drug smuggling, but domestic drug use remains relatively low. The Ministry of Public Security stated that the US has not reported any fentanyl precursor seizures originating from China since Beijing began taking legal action on drug issues.

The large trade deficit between China and the US, which reached nearly US$ 1 trillion last year, has long been a target of Trump’s complaints. The tariffs will make Chinese goods more expensive for US consumers, who will ultimately bear most of the costs of importing everything from toys to clothing.

China’s key export markets could also be impacted if US consumers decide to "buy American products." China’s domestic economy has struggled to respond to a series of government-backed stimulus measures, while large-scale overseas infrastructure projects and other government initiatives have added to the already high national debt, threatening greater economic stagnation.

This situation has started to undermine President Xi Jinping’s efforts to surpass the United States in key economic and political indicators, threatening his ambitions to conquer Taiwan and assert China's dominance in the Indo-Pacific region.

Ending illegal immigration has also been a key political message for Trump, including in his tariff actions against neighboring countries like Mexico and Canada. While illegal immigration from China is relatively small, Trump has warned all countries that he will hold them accountable for their citizens entering the US without permission.

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