Zhou Xiaoming

Opinion | US tariffs on China are a slap in the face for global trade and the WTO

The tariffs largely represent US efforts to bend the rules to reverse its fortunes in sectors where it is losing ground and struggling to compete with China

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Zhou Xiaoming

Published: 8:30pm, 4 Jun 2024

May 14 was a sad day for the multilateral trading system. The United States has dealt another heavy blow to the World Trade Organization.

In a sweeping decision on China tariffs, the Biden administration decided to keep intact all the duties former president Donald Trump slapped on some US$300 billion of Chinese goods. Furthermore, it has imposed new, hefty tariffs on products such as semiconductors, ship-to-shore cranes, advanced batteries, solar cells, steel and aluminium – including a quadrupling of the tariffs on Chinese electric vehicles (EVs).

The decision is the culmination of a four-year review of Section 301 tariffs introduced under Trump in 2018. Some of these duties were judged by a WTO expert panel in September 2020 to be violating the organisation’s rules.

The Biden administration could have shown its professed commitment to the world trade body by ditching the duties. Instead, it chose to defy the WTO ruling and has gone further by expanding the tariffs.

It claims it is a defence against China’s “unfair” trade, which results from what it claims is the country’s technology thefts and intellectual property infringements. Back in 2020, the US accused Huawei Technologies in a court case of stealing a long list of American technologies and trade secrets, which Huawei, already the leader in 5G technologies, denied.

There is also no capacity whatsoever in the United States to manufacture the kind of cranes the tariff targets. And its EV and solar power industries lag behind their Chinese counterparts. In these and other sectors, Chinese companies enjoy a technological edge over their American competitors. Clearly, US President Joe Biden’s justification is nothing short of a myth.