Biden’s new tariffs on Chinese goods are mostly symbolic. Here’s why.

The tariffs affect 14 categories of Chinese goods including green technology such as electric vehicles, solar panels and EV batteries — sectors that Beijing has prioritized as it tries to dig out from an economic slowdown. Similarly, the U.S. imports less than 1% of its steel from China and just over 5% of its aluminum.Lithium-ion batteries, however, are a different story, accounting for about $13 billion of the $18 billion in affected Chinese goods. The proportion of U.S. lithium-ion EV battery imports coming from China has surged in recent years, reaching 70.5% in 2023 as China continues to dominate the supply chain for a fundamental component of electric vehicles. A 25% tariff on natural graphite from China, the world’s largest producer, has been delayed until 2026, allowing more time to find alternative sources.The U.S. trade deficit with China is at its lowest since 2010 as the U.S. imports fewer goods from China — $427.2 billion worth in 2023, down 20 percent from the year before. The latest U.S. tariffs are more targeted compared with the Trump tariffs, which affected about $300 billion in Chinese goods, said Chim Lee, a senior analyst on China and Asia at the Economist Intelligence Unit. Biden administration officials have accused China of having industrial “overcapacity” in areas such as EVs, solar panels and lithium-ion batteries, which they worry could lead Chinese manufacturers to flood overseas markets with low-priced products that undercut domestic competitors. China denies that it has an overcapacity problem, saying the U.S. tariffs are protectionist in nature and designed to block the development of the Chinese economy. But at the same time, the whole world is also interested in transitioning to a greener world.” In addition to promoting the development of U.S. EVs and other domestic industries, he said, the idea is to encourage U.S. allies to announce their own tariffs on Chinese goods — as the European Commission did for Chinese EVs in June. The tariffs may push Chinese automakers, solar panel manufacturers and others to further shift production to places that are not subject to them, such as Southeast Asia and Mexico, which last year surpassed China as the top source of U.S. imports. That’s not necessarily a bad thing, said Charles Benoit, trade counsel for the Coalition for a Prosperous America.When a company moves production from China to another country, he said, “that’s also promoting resilient supply chains, which is also one of our policy goals. So I think that the tariffs will have an overwhelmingly positive impact.” While some of the tariffs serve mainly to generate U.S. government revenue without cutting off imports of needed products, the higher ones are designed more explicitly to shut out some products entirely. Benoit said the tariffs would significantly slow down the expansion of Chinese EVs in the U.S. while keeping American carmakers competitive and focused on innovation, particularly when it comes to lithium-ion batteries. In terms of retaliation, Lee said, Beijing has been “quite reserved” in its response to the tariffs as it tries to improve relations with the U.S. and other countries. – This Summarize was created by Neural News AI (V1). Source: https://www.nbcnews.com/news/world/china-tariffs-biden-symbolic-industrial-overcapacity-rcna172215