Azhar Azam

Opinion | How the US’ China tariffs could hurt American national security

The ongoing tariff war could slow down the clean energy transition in the US at a time when climate change continues to threaten nations

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BYD electric cars for export wait to be loaded onto a ship at Yantai port in eastern China’s Shandong province, on April 18. The tariffs on Chinese electric vehicles and other imports not only undermine the global economy but could also thwart global climate ambitions. Photo: AFP

Azhar Azam

Published: 8:30pm, 15 Oct 2024

US Secretary of Commerce Gina Raimondo, on a call with her Chinese counterpart Wang Wentao this month, conveyed American concerns about decreasing regulatory transparency in China, non-market policies and practices and structural overcapacity in industrial sectors, while reiterating that the US’ “small yard, high fence” approach aims to safeguard national security in as targeted a manner as possible.

Unlike in January, the US Commerce Department readout this time did not mention that US policy is not aimed at “containing” China’s development.

Shortly before this latest call, US Treasury Undersecretary for International Affairs Jay Shambaugh said in a radio interview that Beijing had come away from recent bilateral dialogue with a “more nuanced understanding” of US President Joe Biden’s steep tariff hikes on Chinese imports – including a tariff rate of 100 per cent on electric vehicles, 50 per cent on solar cells and 25 per cent on steel and aluminium – so “you haven’t seen some sort of huge escalation or retaliation”.

A recent US refrain is “balanced growth” in domestic and international economies. Yet, Washington’s accusations of overcapacity in certain Chinese sectors and state-dominated economic practices could weaken the very Economic Working Group that was established to bring stability to the bilateral economic relationship.

In addition, whether under pressure from the United States or domestic protectionist forces, the European Union has announced its own tariffs on Chinese EVs, while Canada has imposed new tariffs on Chinese EVs and other imports.

These actions, aimed at tilting the balance of growth in their favour, not only undermine the global economy and disrupt supply chains but could also thwart global climate ambitions, since high replacement costs will deter consumers from trading in their combustion engine cars for EVs.