China has introduced actions against Google and other U.S. companies as tensions in trade between the two nations continue to rise

In 2017, Google revealed plans to open a small artificial intelligence center in China, but the initiative was shut down two years later, and the company no longer conducts AI research in the country, according to a blog post. Meanwhile, China’s Ministry of Commerce announced that it had added PVH Corp, the parent company of brands like Calvin Klein and Tommy Hilfiger, as well as U.S. biotech firm Illumina, to its "unreliable entity" list.

China accused the two companies of taking "discriminatory actions against Chinese businesses" and harming the legitimate rights and interests of Chinese firms. Being placed on the blacklist could result in fines and various sanctions, such as trade restrictions and the revocation of work permits for foreign employees. Google, PVH, and Illumina did not respond to requests for comment outside of regular U.S. business hours. PVH had previously faced scrutiny from Chinese regulators over alleged improper activities related to the Xinjiang region. According to Capital Economics, these actions serve as warnings from China, signaling a willingness to harm U.S. interests if necessary, though they still leave room for China to retreat from such measures. 

"The tariffs might be delayed or canceled before they are enforced... The investigation into Google could end without any penalties."

China has imposed a 10% tariff on U.S. farm equipment imports, potentially affecting companies like Caterpillar, Deere & Co, and AGCO, along with a limited number of trucks and large-engine sedans from the U.S. This could also impact Tesla’s Cybertruck, which the company has been marketing in China while awaiting regulatory approval for sales. In December, China’s Ministry of Industry and Information Technology briefly classified the Cybertruck as a "passenger car" before removing the post. If the Cybertruck is classified as an electric truck, Tesla would face a 10% tariff on future imports from its Texas factory. Tesla had no immediate comment on the matter. The new tariffs will take effect on February 10.

These new tariffs escalate trade tensions between Beijing and Washington, which had been primarily focused on the tech sector during the Biden administration, particularly concerning restrictions on China’s access to advanced semiconductors. In December, China began an investigation into Nvidia for suspected anti-monopoly violations, seen as a retaliatory move against U.S. restrictions on the Chinese chip industry. Additionally, Intel's products sold in China were subject to a security review by a Chinese industry group late last year.

Link source: China announces measures against Google, other US firms, as trade tensions escalate | Reuters