Tension between the United States and China over trade issues rises again

The tension between the United States and China over trade issues seemed to have scaled down in the month of May. In June, however, the US president, Donald Trump, said the 10% tariffs would come into effect if China ‘refuses to change its practices’. China responded by accusing the US of ‘blackmail’, raising fears of a full-blown trade war. Its commerce ministry said the country would take qualitative and quantitative measures and ‘fight back firmly’ against additional tariff measures by the US government. Mr Trump insists that China has been unfairly benefiting from a trade imbalance with the US for years. On Friday 15 June, the Office of the United States Trade Representative (USTR) released a list of over 1000 Chinese products that it plans to target with an additional ad valorem duty of 25 percent. The tariffs are part of the US’ previously announced Section 301 actions, following an investigation into allegedly unfair trade practices by China in the fields of intellectual property protections and forced technology transfers. At the multilateral level, the Office of the USTR is pushing its WTO dispute settlement case against China initiated in late March to address China’s allegedly discriminatory licensing requirements.