The Biden administration will announce new tariffs on Chinese electric vehicles and other goods as early as next week, according to people familiar with the matter, as President Biden looks for ways to protect America’s emerging clean energy sector from a surge in cheap Chinese imports.
The move comes amid growing concerns within the administration that Mr. Biden’s efforts to boost domestic production of clean energy products could be undermined by China, which is flooding global markets with cheap solar panels, batteries, electric vehicles and other products.
The long-awaited tariffs are the result of a four-year review of levies that former President Donald J. Trump imposed on more than $300 billion in Chinese imports in 2018. Most of Trump’s tariffs are expected to remain in place, but Mr. Biden plans to go beyond them by increasing levies in areas that the president showered with subsidies in the 2022 Inflation Reduction Act.
This also includes Chinese electric vehicles, which are currently subject to a 25 percent tariff. The government is expected to increase the rate to a much higher rate to make buying a Chinese electric vehicle unaffordable. The administration is considering tariffs of up to 100 percent, according to a person familiar with the deliberations.
Mr. Biden took steps earlier this year to deny internet-connected Chinese cars and trucks access to the American auto market, including electric vehicles, saying they posed a risk to national security because their operating systems could send sensitive information to Beijing.
The president wants to increase pressure on China and demonstrate his willingness to protect American industry before running against Trump in the November presidential election.
The fate of the China tariffs has been the subject of intense debate in the White House since Mr. Biden took office, with economic and political advisers often arguing over how to proceed. But this year, China has begun ramping up production of the same products — electric vehicles, lithium batteries and solar panels — that the Biden administration has invested billions of dollars to produce in the United States. Beijing’s move has once again ratcheted up trade tensions between the two countries and forced Mr. Biden to push for more aggressive trade restrictions.
Mr. Trump has said he would escalate his trade war with China if re-elected, and said earlier this year that he was considering imposing tariffs of 60 percent or more on Chinese imports.
The level of tariffs the Biden administration is expected to impose on Chinese electric vehicles, batteries and solar products is unclear. The planned release of the review, which will be conducted by the Office of the United States Trade Representative, was previously reported by Bloomberg News.
Some Democrats, including Sen. Sherrod Brown of Ohio, have called on the Biden administration to take more drastic measures to protect the U.S. auto industry. Last month, Mr Brown called for Chinese electric vehicles to be banned from the US, saying they posed an “existential threat” to American automakers, and on Friday he said the import tariffs were inadequate.
“Tariffs are not enough,” Mr. Brown wrote on the social media platform X. “We must ban Chinese electric vehicles from the U.S. period.”
Mr. Biden said last month that as part of the review he was asking the trade representative to also increase tariffs on imported steel and aluminum products from China. The president and his aides have accused the Chinese of selling heavy metals worldwide at artificially low prices in order to eat up market share – to the detriment of American producers.
“My U.S. Trade Representative is investigating the Chinese government’s trade practices regarding steel and aluminum,” Mr. Biden told steelworkers in Pittsburgh. “If this investigation confirms these anti-competitive trade practices, then I urge them to consider tripling tariff rates on both steel imports and aluminum imports from China.”
The president added: “I’m not looking for a fight with China. I’m looking for competition – and fair competition.”
The prospect of the US imposing new China tariffs was criticized in Beijing on Friday. Chinese Foreign Ministry spokesman Lin Jian said the Trump administration’s tariffs had “significantly disrupted normal trade and economic exchanges between China and the United States” and argued they violated World Trade Organization rules.
“Instead of ending these wrong practices, the US continues to politicize trade issues, abuse the so-called Section 301 tariff review process and plan tariff increases,” Mr. Lin said, referring to the legal provision that Washington uses to justify tariffs. “China will take all necessary measures to defend its rights and interests.”
In 2020, during the Trump administration, the United States and China agreed to a comprehensive “Phase 1” trade deal that allowed each of the two countries to review their bilateral tariffs after four years. That bilateral agreement remains in force, but the United States postponed the outcome of its review when the four-year deadline was reached in January.
This pact likely gives Washington the leeway to increase tariffs. Beijing never met that agreement’s specific targets for Chinese imports of American manufactured goods, initially citing the outbreak of the pandemic. Later it adopted the policy of replacing imports with domestic production.
Greta Peisch, a former general counsel in the Office of the U.S. Trade Representative who oversaw the trade investigation for the Biden administration, noted that the European Union is also considering new tariffs on Chinese electric vehicle imports and that Washington’s expected actions are the result of China’s continued pushback aggressive trade policy. Without higher tariffs, she said, the U.S. auto sector will be unable to compete with heavily subsidized Chinese electric cars.
“When you look at the impact of China’s long-standing policies on electric vehicles, you see that they produce much more and have much more capacity than they can accommodate,” Ms. Peisch said. “You really want to go high enough to make sure you’re bucking the trend that we’re seeing.”
Keith Bradsher contributed reporting.
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2024-05-10 17:29:03
www.nytimes.com
