Bilateral tensions between China and the United States have risen over Washington’s move this week to launch unfair trade practice probes into it and dozens of other states.
The US Trade Representative’s Office announced on Wednesday and Thursday that Section 301 unfair trade practice probes would be undertaken into 60 countries for ‘failures to take action on forced labour’, plus 16 trading partners accused of excess industrial overcapacity.
Beijing voiced its opposition to the moves, which are seen as a way to rebuild tariff pressure on countries after the US Supreme Court struck down the Trump Administration’s use of an emergency law to impose global tariffs on all trading partners last month.
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China’s commerce ministry claimed the US had no right to “unilaterally” say if a trading partner has industrial overcapacity and then take restrictive measures.
It vowed to undertake an assessment of the probes, saying it had the right to take all necessary measures to defend its interests.
Meanwhile, the Foreign Ministry on Friday rejected the claim of false labour, saying that was “a lie concocted by the US,” Reuters reported.
However, these trade disputes are hardly new. The US has cracked down on solar panels and other goods from the Xinjiang region in western China for several years under the Uyghur Forced Labour Prevention Act, which was a law undertaken by former President Joe Biden and widely endorsed by major human rights groups.
And China’s “industrial overcapacity” is an issue the Biden Administration also protested about, along with the European Union, and even the IMF has suggested needs to be dealt with.
Two sides to meet in France
The claims come as trade reps from the two countries are due to meet in France this weekend for a further round of talks in the lead-up to a visit to Beijing by US President Donald Trump at the end of this month.
Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer are due to discuss these matters with China’s Vice Premier He Lifeng.
The meeting will be the sixth round of talks between the two sides since the US announced tariffs last April. Beijing hit back at Washington with restrictions on exports of critical minerals and its own tariff measures – until a truce was negotiated and agreed on in late October.
US Trade Rep Jamieson Greer issued a statement late on Thursday that said: “These investigations will determine whether foreign governments have taken sufficient steps to prohibit the importation of goods produced with forced labour and how the failure to eradicate these abhorrent practices impacts US workers and businesses.”
The 60 countries and economies on the list include both China and Russia, plus some of the US’s key allies and trading partners, like Australia, Canada, the EU, Britain, Israel, India, Qatar and Saudi Arabia.
Cloud over Trump’s China visit?
After the Supreme Court ruling, Trump imposed a 10% tariff for 150 days under Section 122 of the Trade Act of 1974.
Greer said he wanted other countries to enforce bans on goods produced with forced labour similar to those enshrined in a nearly century-old trade law.
The US alleges that Chinese authorities have established labour camps for ethnic Uyghur and other Muslim groups. But Beijing denies allegations of abuse.
Greer said he hoped to conclude the Section 301 investigations, including proposed remedies, before Trump’s temporary tariffs expire in July.
China is also likely to be unhappy about the attacks launched by the US and Israel against Iran, which has partly restricted exports of oil and fertiliser to the mainland.
However, Beijing’s loud reaction to these trade probes could also be seen as relatively “standard bluster” before business talks between these two close rivals.
Will they put a cloud over trade negotiations? And President Trump’s visit to Beijing, from March 31 to April 2? No one appears to be suggesting that just yet.
Let’s see what the weekend brings.
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