China's Tariff Response to Trump Administration
China intends to restore the "Phase 1" trade deal signed in 2020 as part of its initial response to tariffs imposed by the Trump administration, reports the Wall Street Journal (WSJ).
According to the WSJ, China's plan includes:
* A pledge to maintain the yuan's value
* Increased investments in the U.S.
* Reduced exports of fentanyl precursors
President Trump recently imposed tariffs on Mexican and Canadian imports, including against China, citing fentanyl and illegal immigration as reasons. China condemned the tariffs but expressed willingness to negotiate to prevent escalation.
In contrast, Canada retaliated with tariffs on $105.17 billion worth of U.S. goods.
The Phase 1 trade deal, signed in 2020, aimed to end a two-year tariff dispute. It obligated China to increase purchases of U.S. exports by $200 billion over two years, although the pandemic interrupted its implementation.
The WSJ report also suggests that China will primarily view the TikTok situation as a business matter, allowing investors in ByteDance to negotiate with American bidders. Trump has previously indicated interest in multiple TikTok acquisition offers, potentially leading to a bidding war.
As of publication, neither the U.S. Department of Commerce nor China's commerce ministry were available for comment due to regular business hours and the Lunar New Year holiday, respectively.