U.S. Administration Persists in Imposing Fresh Tariffs on Chinese Goods Imported
The ongoing trade tensions between the United States and China have expanded beyond tariffs, with a focus on export controls on semiconductors and AI chips. These controls, imposed by the U.S. government, aim to restrict China’s access to advanced technology in these sectors.
The U.S. has expanded its export controls to limit Chinese firms' ability to acquire cutting-edge chips and related technology. These essential components are crucial for both commercial and military applications. The move is part of a comprehensive strategy to curb China’s technological advancement in sensitive areas.
These export controls have caused notable disruption in tech supply chains, forcing companies, particularly in the semiconductor sector, to rethink logistics and sourcing to avoid surcharges and delays. The tension over technology exports is a significant driver of uncertainty beyond traditional tariff disputes.
While tariffs remain a visible and direct economic tool, these export controls represent a strategic intensification of trade tensions. The situation remains fluid with ongoing negotiations and some tentative moves towards easing overall bilateral trade tensions. However, restrictive technology export policies continue to be a key frontier of conflict.
China, unlike many other countries, responded to the U.S. tariffs with immediate counter-tariffs from the start. The tariffs have been gradually increased since April, reaching up to 145 percent on certain Chinese goods. China retaliated with counter-tariffs of up to 125 percent and imposed export controls on strategically important raw materials.
Despite the ongoing tensions, both sides have shown a willingness to engage in diplomatic discussions. In July, delegations from both countries met in Stockholm for new talks on their trade dispute but without result. Both sides left open the possibility of extending the pause in trade talks again after the two days of trade talks in July.
In a commentary in the state-run "People's Daily," China expressed its readiness to achieve substantial progress with Washington. China continues to advocate for a constructive dialogue. The tariffs have been extended until 10 November at 00:01 (Washington time), avoiding an immediate escalation of trade tensions between the U.S. and China.
Further talks took place in London in June. Notably, President Trump initially demanded 20% from Nvidia CEO Jensen Huang for the country. The U.S. government is taking a 15% share of sales of AI chips from American companies Nvidia and AMD to China.
In May, both the U.S. and China agreed to a 90-day suspension of the new tariffs. This suspension was set to expire on 10 October, but it has now been extended. Washington accuses China of deliberately withholding certain raw materials. Beijing, however, criticizes U.S. export controls on semiconductors and AI chips, which hinder Chinese companies' access to modern technology.
As the trade negotiations continue, both countries are navigating a complex web of economic and political challenges. The outcome of these negotiations could shape the global technology landscape for years to come.
The U.S. export controls on semiconductors and AI chips have moved beyond traditional tariff disputes, stirring uncertainty in the tech industry and finance, as China's advanced access to these technologies is limited. This strategic intensification of trade tensions, with China imposing counter-tariffs on certain goods and export controls on raw materials, has placed politics at the forefront of general-news discussions.
