China Moves to Revise Trade Law Amid Rising Tariff Barriers

BREAKING: China has initiated a significant update to its foreign trade law for the first time in over two decades, as global tariff barriers continue to rise. The National People’s Congress began reviewing this critical revision on Monday, August 28, 2023, aiming to bolster China’s legal framework for trade countermeasures amid escalating international trade tensions.

This revision is set to empower China to implement trade bans or restrictions against foreign individuals or organizations deemed a threat to its sovereignty or security, according to the Xinhua News Agency. This move comes amid a backdrop of increasing trade conflicts and could have immediate implications for China’s export-driven economy.

The new draft also proposes the establishment of a “trade adjustment assistance” system and outlines measures aimed at stabilizing supply chains, crucial for mitigating the impacts of rising tariffs. While this update was anticipated this year, its deliberation was not included in the agenda for the scheduled meeting of the Standing Committee this week, raising questions about whether it will be passed in the immediate future.

Authorities have indicated that “other necessary measures” could be taken beyond trade restrictions, although specific details remain vague. This open-ended language allows for a broad array of countermeasures, including potential export controls and investigations targeting foreign companies.

The urgency of these developments is underscored by the recent rise in global trade barriers since Donald Trump returned to the U.S. presidency, which has intensified challenges for China’s economy. Just last month, the U.S. and China extended a truce for 90 days, temporarily staving off higher duties. However, the impacts of this truce appear to be fading as China’s export growth fell to a six-month low in August, signaling potential instability in its trade relationships.

Adding to the tension, China announced initial anti-dumping duties on pork imports from the European Union last week, a move that further complicates trade relations following the EU’s tariffs on Chinese electric vehicles. Reports indicate that Mexico is also considering implementing tariffs on Chinese products, indicating a potential escalation of trade conflicts on multiple fronts.

As these legal revisions unfold, the implications for global trade dynamics are profound. Businesses and investors are advised to closely monitor the outcomes of the National People’s Congress discussions in the coming days. The trajectory of China’s foreign trade policy could reshape international trade landscapes, impacting economies worldwide.

Stay tuned for further updates on this developing story, as the potential ramifications of these changes could be felt globally.