Within minutes of U.S. tariffs taking effect, China responded with measures of its own on American imports, opening a new chapter in trade tensions between the two countries.
The rapid-fire response from Beijing was announced after Trump's 10 percent tariff across all Chinese imports came into effect on February 4. The Chinese tariffs will impose 15 percent levies on U.S. coal and liquefied natural gas (LNG), as well as 10 percent tariffs for crude oil, farm equipment, and some cars. China's Finance Ministry said that the measures will start on February 10.
SEE ALSO: U.S. Tariffs On Canada, Mexico Suspended For 30 DaysChina's Commerce Ministry and its Customs Administration also announced separate moves that impose export controls on critical minerals tungsten, tellurium, ruthenium, and molybdenum based on national security grounds. Beijing also announced an antitrust probe into Google.
The tit-for-tat tariffs mark a renewal of the trade war waged by Beijing and Washington during U.S. President Donald Trump's first term in office.
During the first trade war, Trump deployed tariffs to try to get China to bend on trade issues and China replied with tariffs of its own. U.S. tariff rates on Chinese goods rose sixfold to 19 percent, while Chinese tariffs on U.S. goods nearly tripled to 21 percent, shaking markets as the world's two largest economies ramped up economic tensions.
SEE ALSO: EU Braces For U.S. Tariffs As Trump Signals Brussels Could Be NextWashington says the current U.S. tariffs were levied on China for not halting the flow of illicit drugs into the United States. When the measures were first announced on February 2, Beijing said that it would file a legal case against the United States at the World Trade Organization (WTO) and “take corresponding countermeasures,” without elaborating further.
China is the main source of the supply of many leading critical minerals and many of those banned for export in the new Chinese measures are used in the production of electronics and high-tech devices.
The exchange of tariffs between Beijing and Washington comes after Trump suspended his threat of 25 percent tariffs on Mexico and Canada. Those agreements were reached on February 3 and include a 30-day pause in return for concessions on border and crime enforcement with the two neighboring countries.
No such agreement was reached with Xi, and the White House said that Trump does not plan to speak with the Chinese leader until later this week.