On February 3, Reuters reported that China's initial response to the tariffs imposed by U.S. President Donald Trump's administration will focus on reinstating the trade deal signed in 2020 during Trump's first term, cited by the Wall Street Journal.
According to the WSJ report, China's strategy will also involve commitments to not devalue the yuan, increase investments in the U.S., and decrease exports of fentanyl precursors.
In response to Trump's tariffs on Mexican, Canadian, and Chinese imports due to fentanyl and illegal immigration, China retaliated with its tariffs while signaling openness to discussions. Conversely, Canada, a traditional U.S. ally, imposed tariffs on $155 billion worth of American goods.
The Phase 1 trade agreement signed by Trump and Beijing in 2020 ended a prolonged tariff dispute, with China falling short of the purchase targets due to COVID-19 impacts.
In other developments, Trump's administration directed the USTR to evaluate China's adherence to the trade deal. Additionally, China intends to address TikTok predominantly as a commercial matter, allowing potential U.S. investors in ByteDance to negotiate bids.
Trump's interest in selling TikTok to American buyers, possibly including Microsoft, was highlighted, with a desire for a competitive bidding process.
The U.S. Department of Commerce did not respond to requests for comments outside regular hours, and China's commerce ministry was unreachable due to the Lunar New Year holiday.