The United States has decided to implement tariffs on Chinese semiconductor imports, but the move will now be postponed until June 2027. This decision, revealed on Tuesday, appears to be a strategic attempt by the Trump administration to maintain a fragile trade truce with Beijing amidst ongoing tensions.
Background on Tariffs
According to the Office of the US Trade Representative (USTR), the tariffs will specifically target older-technology chips, following a year-long investigation into China’s practices deemed “unreasonable” in its pursuit of semiconductor dominance. This probe was initiated under former President Biden’s administration.
Delaying the Action
- The USTR stated the specific tariff rate will be announced at least 30 days before it takes effect.
- This delay allows the US to retain leverage in negotiations with China without escalating trade tensions.
- China’s embassy in Washington has not publicly responded yet, but has historically opposed such tariffs.
Impact of the Delay
This postponement comes at a time when Washington is attempting to ease tensions over China’s restrictions on rare earth metal exports—essential materials for global tech supply chains. In conjunction with this tactic, the US has also delayed rules that would limit technology exports to certain blacklisted Chinese firms.
Ongoing Trade Investigations
The semiconductor industry is keeping a close watch on an additional investigation under Section 232 of US trade law, which could lead to further tariffs not only on Chinese products but on a variety of electronics from multiple countries. Although there has been speculation about new duties, officials have indicated that significant new tariffs are unlikely in the short term.
As of now, Chinese semiconductors already face steep tariffs, including a recently imposed additional 50% duty that took effect on 1 January 2025, heightening the stakes for all parties involved.
For now, it seems the US is treading cautiously, weighing the risks of trade escalation against the critical need for ongoing negotiations with one of its largest trading partners.