Beijing has now reportedly developed a toolkit to target the United States where it hurts in the years after President Trump’s initial trade conflict with China. It is currently preparing to fully deploy them.
In response to increased U.S. tariffs of 104% on Chinese goods that went into effect at midnight on Wednesday, China is raising duties on all U.S. imports to 84%.
Additionally, it placed export restrictions on a dozen American companies, including producer American Photonics and BRINC Drones, and placed six U.S. companies, including defense and aerospace-related enterprises Shield AI and Sierra Nevada, on a trade blacklist.
Trump on Wednesday moved to halt increasing duties on dozens of countries but singled out China for an even greater tax hit, seemingly further infuriated by the wide range of remedies.
Trump declared that he would immediately increase levies on China to 125%. Beijing and Washington are currently on the verge of a full-scale economic conflict.
Trump has made tariffs his preferred trade weapon, but China’s approach goes far beyond enforcing its own tariffs; it also depends on luring American businesses to the Chinese market.
How to cause suffering to businesses that rely on their connections to the second-largest economy in the world is a major theme in its calculations.
Export controls of vital materials used by American companies to produce chips and defense-related goods, regulatory investigations aimed at intimidating and punishing U.S. companies, and blacklists meant to prevent U.S. companies from selling to China are some of the tools Beijing has already employed and is probably going to increase.
Authorities are also planning new strategies to get American businesses to cede their intellectual property, which is their crown jewel, or risk losing access to the Chinese market.
The toolset highlights Xi Jinping’s ability to wage a protracted economic war against the United States.
The seeming dissociation of the two capitals also emphasizes the growing risks for American businesses doing business with, investing in, or just trading with China.
[READ MORE: China Considering Banning US Films In Retaliation for Tariffs]
