On February 2, China’s government criticized the Trump administration’s imposition of a 10% tariff on Chinese imports, while leaving the door open for talks with the US to avoid further conflict. Beijing plans to challenge President Donald Trump’s tariff at the World Trade Organisation (WTO) and take unspecified “countermeasures” in response to the levy, which takes effect on February 4, according to China’s finance and commerce ministries.
This response marks a departure from the immediate escalation seen during Trump’s first term and reflects a more measured tone from Beijing in recent weeks. On February 1, Trump ordered 25% tariffs on Canadian and Mexican imports and 10% on goods from China, citing the need to curb the flow of fentanyl, a deadly opioid, into the US.
China’s commerce ministry stated that Trump’s move “seriously violates” international trade rules and urged the US to “engage in frank dialogue and strengthen cooperation.” Filing a lawsuit with the WTO could allow Beijing to stand up for the rules-based trading system long advocated by US administrations of both parties. However, the WTO’s dispute settlement system has been effectively shut down since 2019 when Trump blocked appointments of judges to handle appeals.
Chinese officials have been encouraged by signs that Trump may be seeking a more nuanced relationship with China since a conversation with Chinese leader Xi Jinping in January. Both Republicans and Democrats view China as the biggest foreign policy and economic challenge to the US.
China’s massive trade surplus, almost US$1 trillion last year, is a vulnerability for Beijing. Analysts expect China to try to strike a deal early with Trump to soften the blow from US trade actions. China has been preparing for the long-expected tariffs by deepening ties with allies, pushing for self-reliance in key areas of technology, and setting aside funds to support its economy.
China’s sharpest pushback on February 2 was over fentanyl, an area where the Biden administration had also urged Beijing to crack down on shipments of China-made precursor chemicals needed to manufacture the drug. “Fentanyl is America’s problem,” China’s foreign ministry said, highlighting the extensive anti-narcotics cooperation with the US and the remarkable results achieved.