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The American government announced on May 14 a new increase in customs duties on goods from China. This increase includes electric cars, lithium batteries, photovoltaic products, essential minerals, semiconductors, steel, aluminum, port cranes and personal protective equipment.
It is worth noting the additional customs duties imposed on Chinese new energy products. Customs duties on imports of Chinese electric cars increase from 27.5% to 102.5%, those on imports of solar cells from 25% to 50% and those on lithium batteries from 7.5% to 25%. %. Easy to understand that the American government is this time targeting Chinese new energy industries. No wonder several senior US officials have recently stepped up hype about China’s so-called new energy “overcapacity.” This is nothing more than an excuse to increase customs duties.
The United States has brandished the tariff stick again, can it work? Due to multiple restrictions, Chinese electric cars, lithium batteries, and chips have never entered the U.S. market on a large scale. According to available data, at present, electric cars, medical supplies and semiconductors account for only 5.9% of China’s total exports to the United States, accounting for less than 1% of total exports. from China. In 2023, China will only export more than 10,000 electric cars to the United States, or less than 1% of total exports. In the first quarter of this year, China exported fewer than 2,000 electric cars to the United States.
Japanese business daily Nihon Keizai Shimbun pointed out that related Chinese industries are not dependent on the US market, and additional tariffs imposed by the US are unlikely to have a substantial impact on Chinese companies. According to analysis by the American news agency Bloomberg, these American measures against the Chinese green technology sector “will hardly weaken China’s economic growth”.
So why is the US government doing this? According to analysts, on the one hand, because the United States is less competitive than China in the field of new energies, American politicians have no choice but to resort to protectionist measures to hinder the development of China’s advantageous industries to seek a more favorable environment for their own businesses.
On the other hand, it is more of a “political spectacle.” » This year is presidential year in America. But the U.S. economy faces high inflation, a high budget deficit and multiple other challenges. Therefore, blaming others becomes the usual choice of the current administration. As many analysts have pointed out, the Biden government launched a “tariff war” against China, notably for domestic political reasons. The aim is to solicit more votes by getting tough on China on economic issues of concern to voters in swing states.
So can additional customs duties help the little calculations of American politicians? The answer is negative.
From an economic perspective, the slow development of new energy vehicles in the United States has its own reasons, including high production costs, insufficient charging batteries and other supporting infrastructure. These knots cannot be untied by the imposition of additional customs duties.
As for American politicians who try to solicit votes by increasing customs duties, it is difficult to see their wish fulfilled. Because a large number of facts have proven that the trade war with China launched by the US government in 2018 has already taken a heavy toll on American businesses and people. According to Moody’s, American consumers bore 92% of the costs stemming from increased tariffs against China. Other studies have shown that the trade war with China has cost U.S. companies $1.7 trillion in market value and nearly 250,000 jobs.
Despite these lessons, the US government has fallen back into the same mistake. American businesses and consumers will inevitably be more seriously harmed. According to statistics, currently in the United States, local electric car brands use 30% to 51% parts from China. U.S. automakers are generally concerned that additional tariffs imposed on China will drive up the cost of manufacturing electric vehicles, increase the burden on domestic consumers, and ultimately seriously affect the processing and distribution of electric vehicles. upscaling of the American automobile industry.
China’s new energy industry has not only enriched global supply, alleviated global inflationary pressure, but also made important contributions to the global response to climate change and green transition. The United States seeks to contain China by all means, but this will not hinder China’s development. The tariff stick brandished by Uncle Sam will only end up falling on itself.