The Biden administration has announced plans to increase tariffs on solar wafers, polysilicon, and certain tungsten products from China in an effort to protect U.S. clean energy businesses. The U.S. Trade Representative's office revealed that tariffs on Chinese-made solar wafers and polysilicon will be raised from 25% to 50%, while duties on specific tungsten products will go up from zero to 25%, effective January 1. These actions come after a review of Chinese trade practices under Section 301 of the 1974 Trade Act.
USTR Katharine Tai stated that these tariff increases aim to counter the harmful policies and practices of China and will complement domestic investments made by the Biden-Harris Administration to promote a clean energy economy and enhance critical supply chain resilience.
Reports indicate that U.S. and Chinese officials are engaged in trade talks as the year comes to a close. Meanwhile, China's Commerce Ministry criticized the approval of a defense spending bill by the U.S. House of Representatives, which includes funding for the removal of Chinese telecoms equipment from U.S. networks.
Recent tensions have also seen Washington tightening restrictions on Chinese access to advanced semiconductor technology, prompting Beijing to ban exports of critical minerals needed for computer chips to the U.S. China has also increased controls on graphite exports to the U.S.
China is a major supplier of these materials, and the U.S. has been seeking alternative sources globally. Tungsten, a crucial metal dominated by China, is used in various industrial applications, including armaments, x-ray tubes, and light bulb filaments.
Trade frictions have been escalating, with the Biden administration maintaining tariffs imposed during the previous administration but adopting a more targeted approach. The U.S. and its allies accuse China of improperly subsidizing exports and pressuring foreign companies to transfer technology.
China's dominance in the solar panel market has raised concerns, with the International Energy Agency urging countries to assess their supply chains and mitigate risks. The U.S. previously imposed tariffs on Chinese solar panels in 2018, leading to a complaint filed by China with the World Trade Organization.
The recent investigation by the USTR has resulted in increased tariffs on various products, including electric vehicles, syringes, medical gloves, semiconductors, and steel and aluminum products. Tariffs on Chinese-made electric vehicles have surged to 100%, while those on lithium batteries have risen to 25%.
