Trade tensions growing between US, China and EU

21 May 2024


China’s Ministry of Commerce has announced an anti-dumping investigation into imports of a plastic that is used in electronics and cars – polyoxymethylene copolymer. The investigation covers imports from the US, the EU, Taiwan and Japan.

This is seen by many as an escalation, following the high-profile announcement on 14 May that the US will sharply increase tariffs on a number of Chinese imports, including electric vehicles, solar panels and computer chips.

The US-announced rate increases cover a wide range of goods, including:

  • A rise in tariffs on “certain steel and aluminium products” this year, to 25%
  • A rise in the tariff on EVs, from 25% to 100%, in 2024
  • A rise in the tariffs on semiconductors, from 25% to 50%, by 2025
  • A rise to 25%, up from 7.5%, for batteries and battery parts in 2024, with lithium-ion non-EV batteries increasing to 25% by 2026

In a separate move, China sanctioned three American defence firms over their sales of weapons to Taiwan, which has just inaugurated a new president, putting international disagreements over the island’s status under the spotlight. General Atomics Aeronautical Systems, General Dynamics Land Systems, and Boeing Defense, Space & Security are now barred from "import and export" business, and its senior executives are barred from living in, or even visiting, China.

The EU launched a series of probes into Chinese imports: last month two solar panel makers were spotlighted, with the allegation that they receive unfair government subsidies, and now an investigation has been opened into China’s production and exports of tinplate steel. The European Commission will decide whether to impose measures against imports of Chinese-made EVs before 4 July.

Trading with China

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