New tariff probes herald fresh harm to trade: China Daily editorial

In a major move following the United States Supreme Court's decision last month to dismantle much of the US administration's global tariff program, Washington has launched two new trade probes under Section 301 of the Trade Act of 1974 that could pave the way for imposing additional tariffs on key trading partners, including China, as soon as this summer.

One of the investigations, as unveiled by US Trade Representative Jamieson Greer on Wednesday, will focus on economies "that we have evidence appear to exhibit structural excess capacity and production in various manufacturing sectors".

The second Section 301 investigation launched by the US administration is into goods that it alleges have been produced with "forced labor".

Greer expressed the hope that the probes would be concluded before the temporary tariffs imposed in late February expire in July. After the Supreme Court ruled on Feb 20 that the US administration's global tariffs were illegal, Washington implemented a 10 percent tariff for 150 days under Section 122 of the Trade Act of 1974.

Commenting on the investigations, a spokesman for China's Foreign Ministry rightly pointed out on Thursday that the so-called "overcapacity" is a false proposition, and China opposes using it as a pretext for political manipulation. He said that the US should work with China to resolve the relevant issues through consultation on the basis of equality, respect and mutual benefit.

The unilateral attempt by the US to apply pressure on its trading partners, apparently to gain concessions in such areas as industrial policies and market access under the guise of "fair trade", reminds people of tariff extortion the US has previously used to achieve its selfish objectives.

The US administration's coercive tariff strategy is highly damaging to global trade and counterproductive to US interests. The deep integration of global supply chains means that any tariff costs will ultimately be borne by US businesses and consumers. Studies show that 90 percent of the US administration's tariff costs are absorbed by US importers and consumers, directly driving up inflation and increasing household expenses.

Moreover, the legality of using Section 301 to address trade disputes between the US and other economies has always been questionable, as the unilateral trade sanctions bypass the global dispute settlement system. The World Trade Organization has repeatedly ruled against Section 301 tariffs. The misuse of executive power in handling trade rows not only violates international trade rules, but also contradicts the US legal system.

Many of the targeted economies have already engaged in consultations or inked trade deals with the US administration. So the new probes are also set to damage the US' credibility further. The coercive approach of the US administration to trade and its repeated policy reversals are increasingly isolating the US on the global economic stage.

The timing of the new tariff probes has prompted speculation that the US administration is seeking to gain more leverage and room to maneuver, as it has been anticipated that the next round of economic and trade negotiations between China and the US will be arranged in the near future.

The two sides reached a one-year trade truce late last year, during which they agreed to lower tariffs and export controls. The new probes will not serve their common interests as they will necessarily introduce greater uncertainty into the hard-won truce, as well as their future trade consultations.

What has happened so far proves that there are no winners in tariff wars. The world has seen through the US administration's so-called "art of the deal", along with the inherent limitations of its tariff-obsessed policy circle, which faces mounting resistance at home and coordinated countermeasures abroad.

The US administration should objectively weigh the costs and benefits of its tariff policy, face up to the realities of the consequences, and refrain from injecting additional instability into an already volatile world.

The US will not profit from the losses of others; instead, it will ultimately pay a heavy price for its own ill-advised tariff policy.