China on Tuesday said it would impose fresh tariffs on U.S. imports in swift retaliation to new U.S. duties that came into effect on Chinese goods.
China’s finance ministry said that, starting Feb. 10, it would impose levies of 15% for U.S. coal and 10% for crude oil, farm equipment and some cars. The announcement came just minutes after an additional 10% tariff across all Chinese imports into the U.S. came into effect at 12:01 a.m. ET on Tuesday.
The moves by Beijing and Washington escalate tensions between the world’s top two economies and effectively renew a trade war that began in 2018 during President Donald Trump’s first term.
The latest levies also follow Trump’s offer, in a series of last-minute phone calls, to give 30-day reprieves to Mexico and Canada, the U.S.’s two largest trading partners, on proposed tariffs.
Tariffs are essentially taxes charged on goods imported from another country. They are typically set at a percentage of the goods’ value and usually paid by the importer. The extra costs are generally passed on to the consumer.
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Trump has repeatedly said the Chinese tariffs are needed because Beijing is not doing enough to halt the flow of illicit drugs like fentanyl, a deadly opioid, into the U.S. China disputes this.
“China hopefully is going to stop sending us fentanyl, and if they’re not, the tariffs are going to go substantially higher,” Trump said on Monday.
Trump has acknowledged that Americans could feel “some pain” from his tariffs.
China has called fentanyl America’s problem and said it would challenge the tariffs at the World Trade Organization and take other countermeasures, but also left the door open for talks. The U.S. is a relatively small source of crude oil for China, accounting for 1.7% of its imports last year, worth about $6 billion.
