China Urges US: Halt Copper Tariff Probe, Protect Global Supply Chains

The US-China trade spat has taken a new turn with China urging the US to halt its tariff probe into copper imports. The US, under Section 232, alleges that China relies on state subsidies and overproduction to dominate global copper production. This move has significant implications for global supply chain dynamics, particularly in the context of China's role as a major copper producer and exporter.

Copper is a crucial industrial material with wide-ranging applications, from electrical and electronic products to transportation equipment and industrial machinery. The US imported $4.6 billion worth of copper and copper products in 2020, with China being one of the top suppliers (US Census Bureau). A disruption in the supply of copper could have severe consequences for these industries, both in the US and globally.

If the US imposes tariffs on copper imports, it could lead to increased production costs for US manufacturers, making them less competitive in the global market. This could, in turn, lead to job losses and economic stagnation in the US. Moreover, the tariffs could also lead to retaliation from other countries, further exacerbating global trade tensions.

In the context of China, the tariffs could have a significant impact on its copper industry and exports. China is the world's largest producer and consumer of copper, accounting for around 40% of global copper production and 45% of global copper consumption (International Copper Study Group). A reduction in US imports of Chinese copper could lead to a decrease in demand for Chinese copper products, potentially leading to a slowdown in the Chinese economy.

Furthermore, the tariffs could also have broader implications for global supply chains. Copper is a key input in many industries, and a disruption in its supply could lead to a ripple effect, affecting other industries and countries that rely on copper for their production processes. This could lead to a slowdown in global economic growth and increased trade tensions between countries.



China's response to the US tariff probe has been swift and resolute. China has taken countermeasures, such as imposing import tariffs on American goods and restricting exports of raw materials. These countermeasures are in line with the WTO's rules on retaliation, which allow WTO members to impose tariffs on goods from a country that has violated WTO rules, provided that the retaliation is proportional to the harm caused by the violation.

The US tariff probe on copper imports is part of a broader trend of US-China strategic competition, with the US seeking to address direct challenges posed by China to its interests. The US tariff probe could exacerbate geopolitical tensions between the US and China, as well as with other countries affected by the disruption of global supply chains. The US tariff probe could also have implications for regional trade agreements and alliances, as countries may be forced to choose sides in the US-China trade dispute.

In conclusion, the US tariff probe on copper imports has significant potential economic and geopolitical implications for both the US and China, as well as global trade stability. The disruption of global supply chains, increased production costs, and escalating trade tensions could negatively impact bilateral relations and hinder efforts to promote a more stable and prosperous global trading system. China's response to the US tariff probe highlights the importance of multilateralism and the need for countries to work together to address global challenges.