Well-known Chinese news site NetEase (NASDAQ: NTES) recently reported that the office of the U.S. Trade Representative (USTR) said that the four-year-old tariffs on China will be extended. The reason for this decision is that the office has received hundreds of related requests from U.S. businesses. In the meantime, a tariff review process will follow. USTR Katherine Tai, the United States Trade Representative, has urged the maintenance of punitive tariffs on Chinese goods. She said she was reluctant to give up the leverage provided by the tariffs. Her attitude determines that it is difficult to cancel the US tariffs on China. In addition to the tariffs, more powerful trade measures are being considered, such as restructuring the high-tech industrial chain and restricting high-tech exports to China before making an investment. Recently, the U.S. government has been discussing a bill with Congress. It is an investment restriction bill that would require U.S. companies to disclose in advance which Chinese industries they may invest in while establishing a system within the U.S. government that would empower the U.S. government to prevent directly any U.S. companies from investing in China. The reasons for the intensification of China-US trade tensions is that the relationship between the two countries is changing from trading partners to competitors. The Biden administration’s strategic positioning against China has undergone a fundamental change. The two world economic powers, China and the United States, are currently confronting each other in political, economic and security realms. After the U.S. House of Representatives Speaker Nancy Pelosi visited Taiwan last month, the escalation of tension in the Taiwan Strait made the relationship between the two countries even worse.
Source: NetEase, September 4, 2022
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