When the news was broadcast that the U.S. government had imposed tariffs of up to 100% on China's new energy vehicles, batteries and photovoltaic solar panels, the global industry was in an uproar. It seems that this is a heavy blow to China's new energy field, but in fact, many people in the industry think that this punch is on cotton, soft. The latest analysis article of the Wall Street Journal pointed out in the American media that this is only a superficial toughness, and the real killer move has not yet come.
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First of all, we have to see how hard this "heavy punch" comes. According to the Observer and other international news reports, the U.S. government's new policy proposes to quadruple the existing 25 percent tariff on Chinese new energy products to 100 percent. Behind this decision is clearly the intention of the United States to deliberately curb China's fast-growing market share of new energy in the world.
But the question is, can such tariffs really weaken China's economic momentum? Let's use some numbers to do a simple explanation. In 2023, China exported about 1.5 million electric vehicles to the global market, mainly in Europe and Asia, with the US market accounting for only a small part. In other words, even if the U.S. market were completely closed to Chinese cars, the impact on China's total exports would be limited.
Let's take a look at China's photovoltaic industry. According to the latest data, China's PV module manufacturing accounts for 80% of the world's investment. In other words, from Africa to Southeast Asia, from Europe to South America, most solar projects around the world are inseparable from Chinese photovoltaic panels.
The U.S. market is large, but it's not irreplaceable. Even if the U.S. completely stops importing from China, it will only be a piece of the puzzle that Chinese manufacturers have lost, not the entire puzzle box.
The immediate impact of this move by the United States is obviously limited, but perhaps the real intention of the US government is not this. As the Wall Street Journal notes, a deeper strategy may be in the works.
In fact, with high tariffs, the United States may try to force China toward more internal economic reforms or make concessions on the international stage. But such a strategy seems to ignore an important fact: the resilience of China's economy and the support of diversified markets.
Another possible effect of this policy is to push up costs for consumers in the United States. The prices of electric cars, batteries and photovoltaic panels will rise because of high tariffs, which will directly affect consumers and businesses in the United States. In terms of new energy promotion, this is undoubtedly a step backwards.
In the big chess game of global politics and economy, this move by the United States may be more to demonstrate its tough stance on China to domestic affairs. After all, US President Joe Biden is facing pressure from home and abroad to demonstrate the effectiveness of his policies before the 2024 election.
However, this strategy is not without its risks. The Chinese Foreign Ministry has solemnly stated that China will have to take necessary countermeasures against such unilateral actions of the United States. Such a-for-tat approach could trigger a new round of trade war, affecting not only the two countries, but also the global economy.
What's more, the real-world economic ecology is far more complex than a simple numbers game. The restructuring of the supply chain, the repositioning of the market, and the changes in the needs of global consumers may have unintended consequences under this "heavy punch" of the United States. In addition, there is also uncertainty as to whether other countries will follow the US lead in the face of global economic pressures.
Through this analysis, we can see that although on the surface the U.S. government seems to be making a big move, in fact, it has little substantial impact on the Chinese industry. And the real killer trick of the US government may be hidden in the depths of politics, and it is as important as economic strategy.
In this new type of "cold war", all participants need to be cautious, because if one wrong move is not made, it may affect the future direction of the global economy.
I don't know what you think?