Biden Slaps More Tariffs on ‘Strategic Goods’ Imported from China

On 14 May 2024, US President Joe Biden announced new steep hikes on a list of strategic goods from China. The products include, steel, aluminum, semiconductors, batteries, EV, EV Ship-to-Shore Cranes as well as certain #CriticalMinerals and medical products.

The move some within six months to the Presidential elections in the US scheduled in November 2024. Biden is running for re-election and does not wish to be viewed to be ‘soft on China’, especially when his likely opponent Trump has been voicing loud the anti-China rhetoric.

The new tariff rates are quite substantial and vary from 25% to 100%. Most tariffs will go into effect soon while some will be phased in during 2025 and 2026 to allow the industry ‘adequate time to adapt.’ The tariffs is expected to affect some USD 18 billion of imports from China.

In preparation for the tariff hike, China has invested heavily in Mexico to set up an #EV assembly plant. The US, Canada and Mexico have signed an #FTA in November 2018 which came into effect on 1 July 2020 in replacement of the North American Free Trade Agreement (NAFTA).

USTR Katherine Tai Holds Press Briefing Following President Biden’s Announcement of Tariff Hike

When asked about this possible pathway for Chinese EV to enter the US market, #USTR Katherine stated that the US government will monitor the situation and come up with appropriate measures as and when necessary. For now, Chinese EV have not flooded the US market yet, but it is no secret that the objective of China is to control the global supply chain (#GVC) of EV and to become the global in this sector.

The auto market in US accounts to the sale of nearly 20 million vehicles every year and contributes about USD 100 billion in exports. The motor manufacturers are traditionally in Detroit but can be found in about 15 states. The auto industry employs almost 10 million workers. Since the trade war started, North America has slipped from the top trading partner positon with China to third spot, behind ASEAN and EU.