President Joe Biden, left, greets China’s President President Xi Jinping in Woodside, Calif., Nov, 15, 2023.
| Photo Credit: AP

The Biden administration plans to impose major new tariffs on electric vehicles, semiconductors, solar equipment and medical supplies imported from China, according to a U.S. official and another person familiar with the plan.

Tariffs on electric vehicles, in particular, could quadruple — from the existing 25% to 100%. The plan was described by the people on condition of anonymity because they were not authorized to provide details ahead of a formal announcement.

The tariffs, expected to be announced Tuesday, come as officials across the Democratic administration have expressed frustration over China’s manufacturing “overcapacity” of EVs and other products that they say pose a threat to U.S. jobs and national security.

Industrialized nations including the United States and its European allies fear a wave of low-priced Chinese exports will overwhelm domestic manufacturing. On the U.S. side, there is particular concern that China’s green energy products will undermine massive climate-friendly investments made through the Democrats’ Inflation Reduction Act that President Joe Biden signed into law in August 2022.

The additional tariffs also carry some political heft going into the November presidential election. Both Mr. Biden and his presumptive Republican challenger, former President Donald Trump, have told voters that they’ll be tough on China, the world’s second largest economy after the United States and an emerging geopolitical rival.

Mr. Biden has defined his policy as “competition with China, not conflict.” He has embraced an industrial strategy that has used government financial support to pull in private investment in new factories and advanced technology, while limiting the selling of computer chips and other equipment to China.

Mr. Trump has floated the idea of levying massive tariffs against China in order to reduce the U.S. trade deficit with that country. He has repeatedly claimed that Biden’s support for EVs would ultimately cause American factory jobs to go to China.

Tuesday’s announcement is expected to keep in place some tariffs that were imposed during Mr. Trump’s administration, covering about $360 billion in Chinese goods. The new tax on imports would add products such as Chinese syringes and solar equipment.

There is the risk that tariffs could lead to a broader trade conflict between the two countries as they respond to each other’s moves. China is seeking to create a technological edge and move up the economic chain.

There are some indications that China is cooling its production of lithium-ion batteries used in EVs, cell phones and other consumer electronics at a time when it is facing increasing criticism from the West.

On Wednesday, China’s Ministry of Industry and Information Technology issued a draft rule aimed at “strengthening the management of the lithium-ion battery industry and promoting the sector’s high-quality growth.”

The draft, which was posted on the ministry’s website for public input, says companies should be striving for better technological innovation, higher quality and lower costs, rather than expanding existing capacity.

Lithium battery plants built in restricted farmlands or industrial zones should be shut down, the draft says.

U.S. Trade Representative Katherine Tai is conducting a review of the Trump-era tariffs, and Republican lawmakers including House Ways and Means Committee Chair Jason Smith and Trade Subcommittee Chair Adrian Smith are urging a “swift conclusion” to the probe.

“Continued inaction on the four year review poses serious risks for U.S. farmers, manufacturers, innovators, small businesses and workers,” they wrote in a letter to Tai this week.

Meanwhile, Ohio Democratic Senator Sherrod Brown said in a tweet on Friday that “Tariffs are not enough. We need to ban Chinese EVs from the US. Period.”

The Biden administration has also said it will investigate Chinese-made “smart cars” that can gather sensitive information about Americans driving them. The Commerce Department in February issued a notice of a proposed rulemaking that launches an investigation into national security risks posed by “connected vehicles” from China and other countries considered hostile to the United States.

There currently are very few EVs from China in the U.S., but officials worry that low-priced models could soon start flooding the U.S. market, even with a 25% tariff.

A car model launched last year by Chinese automaker BYD sells for around $12,000 in China. The car’s craftsmanship rivals U.S.-made EVs that cost three or four times as much — and is stoking fear in the U.S. industry.

The Alliance for American Manufacturing — an alliance of businesses and the U.S. Steelworkers union — released a report in February that says the introduction of inexpensive Chinese autos to the American market “could end up being an extinction-level event for the U.S. auto sector.” The U.S. auto sector accounts for 3% of America’s GDP, according to the report.

Treasury Secretary Janet Yellen, who traveled to Guangzhou and Beijing in early April, cited the manufacturing of electric vehicles and their batteries as well as solar energy equipment — sectors that the U.S. administration is trying to promote domestically — as areas where Chinese government subsidies have driven rapid expansion of production.

“China is now simply too large for the rest of the world to absorb this enormous capacity. Actions taken by the PRC today can shift world prices,” she said during a speech delivered in Beijing in April, using the acronym for China’s official name, the People’s Republic of China.

“And when the global market is flooded by artificially cheap Chinese products, the viability of American and other foreign firms is put into question.”

The plan for new tariffs was reported earlier by Bloomberg News and The Wall Street Journal.

Chinese President Xi Jinping said on Monday that China-U.S. ties would impact the “destiny of mankind”, as he met with a group of American senators in Beijing.

Senate Majority Leader Chuck Schumer is the latest high-level American official to go to China as Washington seeks to ease tensions with Beijing, leading a six-person delegation.

“How China and the United States get along with each other in the face of a world of change and turmoil will determine the future and destiny of mankind,” Mr. Xi said as he met with Mr. Schumer at Beijing’s Great Hall of the People.

“I have said many times, including to several presidents, that we have 1,000 reasons to improve China-U.S. relations, but not one reason to ruin them,” Mr. Xi said, adding China-U.S. ties are “the most important bilateral relationship in the world”.

Mr. Schumer, in turn, told Mr. Xi that “our countries, together, will shape this century”.

“That is why we must manage our relationship responsibly and respectfully,” he said.

Earlier China’s top diplomat Wang Yi said he hoped Washington and Beijing could manage their differences “more rationally”.

Meeting with Mr. Schumer at Beijing’s Diaoyutai State Guesthouse, Foreign Minister Wang told the senate delegation he hoped their visit would help the two sides “manage existing differences more rationally, helping the relationship between the two countries return to the track of healthy development”.

Wang also said he hoped they would “more accurately understand China” after the trip, which he said comes as the world is in a “turbulent period of change”.

“The crisis in Ukraine has not yet subsided, and warfare has reemerged in the Middle East,” he said.

“All these various challenges need to be addressed by the international community, and China and the United States should play their due roles,” Wang said.

Schumer, in turn, thanked the Chinese delegation for their hospitality, noting there were several issues of “great concern” he was seeking to raise during his visit.

He said “a level playing field for American business and workers” was his delegation’s “number one goal”.

“Holding accountable China-based companies supplying deadly chemicals fuelling the fentanyl crisis in America” was another objective, he told Wang, as was “ensuring China does not support Russia’s immoral war against Ukraine”.

“Advancing human rights” was an additional priority, Schumer said.

But Schumer also said he was “very disappointed” by a Sunday statement from Beijing’s foreign ministry on the escalating violence between Israel and the Palestinians.

Beijing called Sunday for all sides to show “calm” and “cease fire immediately”.

It did not explicitly condemn a Palestinian attack that has left hundreds in Israel dead, instead urging the establishment of a two-state solution to end the violence.

“The ongoing events in Israel over the past few days are horrific,” Schumer told Wang.

“I urge you and the Chinese people to stand with the Israeli people and condemn these cowardly and vicious attacks.

“The foreign ministry’s statement… showed no sympathy or support for Israel during these tough, troubled times,” he added.

In response to a question on Schumer’s comments at a regular press briefing, ministry spokeswoman Mao Ning said China was “highly concerned about the escalation of conflict”.

“We are very saddened by civilian casualties caused by the conflict,” she said. “We also oppose and condemn actions that harm civilians.

Schumer reiterated his call for Beijing to support Israel in his with meeting Xi, urging the Chinese leader to “stand with the Israeli people”.

On Monday, Schumer also met with Zhao Leji, the head of the standing committee of China’s rubber-stamp National People’s Congress.

“As the two great powers it is natural we find ourselves in competition in areas like trade, technology, diplomacy, and more,” Schumer told Zhao.

“We welcome this competition,” Schumer stressed. “We do not seek conflict.”

Schumer is the latest high-level U.S. official to visit China as Washington seeks to ease tensions with Beijing, which have flared in recent years over everything from trade to human rights.

Secretary of State Antony Blinken, Treasury and Commerce Secretaries Janet Yellen and Gina Raimondo, as well as climate envoy John Kerry, have all visited China this year.

And President Joe Biden on Friday said he may meet Xi in San Francisco in November, but added that nothing has been scheduled yet.

Wang is expected to visit Washington ahead of the APEC summit.

Janet Yellen, United States Secretary of Treasury.
| Photo Credit: AP

The U.S. Treasury Department and China’s Ministry of Finance launched a pair of economic working groups on Friday in an effort to ease tensions and deepen ties between the nations.

Led by Treasury Secretary Janet Yellen and Vice Premier He Lifeng, the working groups will be divided into economic and financial segments.

The working groups will “establish a durable channel of communication between the world’s two largest economies,” Ms. Yellen said in a series of tweets detailing the announcement. She said the groups will “serve as important forums to communicate America’s interests and concerns, promote a healthy economic competition between our two countries with a level playing field for American workers and businesses.”

The announcement follows a string of high-ranking administration officials’ visits to China this year, which sets the stage for a possible meeting between President Joe Biden and his Chinese counterpart, Xi Jinping, in November at an Asia-Pacific economic conference in San Francisco.

China is one of the United States’ biggest trading partners, and economic competition between the two nations has increased in recent years. The two finance ministers have agreed to meet at a “regular cadence,” the Treasury Department said in a news release.

Ms. Yellen, along with other Biden administration officials, traveled to China this year after the Democratic president directed key senior officials to “maintain communication and deepen constructive efforts after he met with Xi in Bali last year.

The groups’ launch also comes after Secretary of State Antony Blinken met with China’s vice president on Monday on the sidelines of the U.N. General Assembly.

Working groups between the U.S. and China are not a new creation.

Reps. Rick Larsen, D-Wash., and Darin LaHood, R-Ill., set up a working group in 2005 between lawmakers in the two nations. And as recently as August, Commerce Secretary Gina Raimondo said she and Commerce Minister Wang Wentao promised to set up a working group of officials and private sector representatives to “seek solutions on trade and investment issues.”

Areas of disagreement between the nations have included tariffs, technology and China’s claims to self-governing Taiwan and large parts of the South and East China Seas.

Tensions between the countries reached a fever pitch earlier this year when a Chinese surveillance balloon was spotted traveling over sensitive U.S. airspace. The U.S. military shot the balloon down off the Carolina coast after it traversed sensitive military sites across North America. China insisted the flyover was an accident involving a civilian aircraft and threatened repercussions.

In April, Ms. Yellen called out China’s business and human rights abuses in Xinjiang, Hong Kong and Tibet while striking a conciliatory tone about how there is “a future in which both countries share in and drive global economic progress.”

Relations between the two countries have become further strained as the Communist nation has grown its ties with Russia despite its continued invasion into Ukraine.

The U.S. last year moved to block exports of advanced computer chips to China, an action meant to quell China’s ability to create advanced military systems including weapons of mass destruction, Commerce Department officials said last October.

Washington:

US Secretary of State Antony Blinken will meet Monday with China’s vice president, the latest top-level dialogue in days between the rival powers.

The State Department said on its public schedule that Blinken will meet Vice President Han Zheng in New York on the sidelines of the UN General Assembly.

The talks come as the United States watches with growing intrigue at personnel changes in Beijing. Qin Gang, handpicked by President Xi Jinping as foreign minister, was abruptly replaced in July by the veteran policymaker Wang Yi.

US officials initially expected Wang to travel to the annual UN meeting, where he may have met briefly with President Joe Biden, but instead, China said that the comparatively lesser-known Han would come.

But Wang, who also is the Communist Party foreign policy director, held talks over the weekend with Biden’s national security advisor, Jake Sullivan, in Malta.

The United States says it is eager to keep open lines of communication with China to manage the frequent tensions between the world’s two largest economies.

Blinken and Treasury Secretary Janet Yellen have both traveled this year to Beijing, resuming contact that had all but ceased during the pandemic.

(This story has not been edited by NDTV staff and is auto-generated from a syndicated feed.)