financetom
Business
financetom
/
Business
/
China challenges Trump tariffs at WTO, package shippers warn of chaos
News World Market Environment Technology Personal Finance Politics Retail Business Economy Cryptocurrency Forex Stocks Market Commodities
China challenges Trump tariffs at WTO, package shippers warn of chaos
Feb 5, 2025 5:23 PM

WASHINGTON (Reuters) - China filed a World Trade Organization complaint on Wednesday against U.S. President Donald Trump's new 10% tariff on Chinese imports and his cancellation of a duty-free exemption for low-value packages, arguing the actions are "protectionist" and break WTO rules.

Beijing's request for U.S. trade consultations came as confusion reigned among shippers and retailers over Trump's closure of the "de minimis" exemption for package imports valued under $800 and widely used by e-commerce firms including Shein, Temu and Amazon ( AMZN ).

A Customs and Border Protection official said all small packages from China and Hong Kong needed to have customs entries on file prior to arrival and there was the potential for some cargo to be sent back without this paperwork.

The WTO said China submitted a request for consultations with the U.S. on the tariffs. China argues in the document that Trump's new duties aimed at halting the flow of fentanyl opioids and their precursor chemicals to the U.S. "are imposed on the basis of unfounded and false allegations concerning China."

It said the duties are discriminatory, only applying to goods of Chinese origin, and are inconsistent with the U.S.'s WTO obligations.

The request for consultations is the start of a dispute process that could lead to a ruling that Trump's duties violated trade rules in the same manner that a 2020 WTO ruling found that his first-term China tariffs broke trade regulations.

But such a victory would be unlikely to bring Beijing relief because the WTO's Appellate Body has been largely inoperable for years, as the U.S. has blocked the appointment of appellate judges over what it views as judicial overreach by the body. This has prohibited a final decision in the 2020 case.

PACKAGE CHAOS

The U.S. Postal Service said on Wednesday it would again accept parcels from China and Hong Kong, reversing a temporary suspension that threatened to disrupt millions of package imports every day.

"We're all running around like headless chickens at this moment in time, trying to second-guess what's going to happen," said Martin Palmer, co-founder of Hurricane Commerce, a cross-border e-commerce data provider. "And in two weeks' time we may be back to normal."

The Trump administration has blamed the de minimis exemption for allowing fentanyl and its precursor chemicals to enter the U.S. unscreened. Recent Reuters reporting has also found that drug traffickers are exploiting the exemption.

USPS said in a statement it was working with the U.S. Customs and Border Protection agency to implement an efficient collection mechanism for the new China tariffs to minimize disruptions to deliveries.

NO TRUMP-XI TALKS

On Wednesday, there was still no call scheduled between Trump and Chinese President Xi Jinping to discuss the new U.S. tariffs and Beijing's retaliatory measures, a person familiar with the matter told Reuters.

Trump said on Tuesday he was in no hurry to speak with Xi as the tariff took effect just after midnight Eastern Time.

China responded with targeted tariffs on imports of U.S. coal, liquefied natural gas, crude oil and farm equipment, and opened an anti-monopoly investigation into Alphabet's Google.

The launch of the new trade war caught the retail and shipping sectors flat-footed.

"There has really been absolutely zero time for anyone to prepare for this," said Maureen Cori, co-founder of New York-based consultancy Supply Chain Compliance. "What we really need is direction from the government on how to handle this without warning or notice."

Currently, de minimis parcels are consolidated so customs can clear hundreds or thousands of shipments at once, but they will now require individual clearances, significantly increasing the burden for postal services, brokers and customs agents, Cori said.

The provision was initially intended as a way to streamline trade, and its use has surged with the increase in online shopping.

About 1.36 billion shipments entered the United States using the de minimis provision in 2024, up 36% from 2023, according to U.S. Customs and Border Protection (CBP) data.

TARIFF UNCERTAINTY

U.S. Treasury Secretary Scott Bessent on Wednesday defended Trump's tariff strategy in his first media interview since taking office, saying it was aimed at bringing manufacturing back to the U.S., including for industries that have largely left U.S. shores.

U.S. Federal Reserve officials on Wednesday pointed to the large policy uncertainty around tariffs and other issues arising from the early days Trump's administration as among the top challenges in figuring out where to take U.S. monetary policy in the months ahead.

Chicago Fed President Austan Goolsbee warned that ignoring the potential inflationary impact of tariffs would be a mistake, whereas Richmond Fed President Thomas Barkin said it remains impossible at this early stage to know where cost increases from any tariffs might be absorbed or passed along to consumers.

(Reporting by David Lawder; Editing by Lincoln Feast.)

Comments
Welcome to financetom comments! Please keep conversations courteous and on-topic. To fosterproductive and respectful conversations, you may see comments from our Community Managers.
Sign up to post
Sort by
Show More Comments
Related Articles >
Market Chatter: Newmont Reduces Workforce by 16% Following Acquisition of Newcrest
Market Chatter: Newmont Reduces Workforce by 16% Following Acquisition of Newcrest
Nov 7, 2025
09:27 AM EST, 11/07/2025 (MT Newswires) -- Newmont ( NEM ) has cut about 16% of its workforce as part of a restructuring following the acquisition of Australian miner Newcrest, Reuters reported Friday, citing an internal memo. In the final stage of the cost and productivity plan, Newmont ( NEM ) cut jobs by roughly 12% at Level of Work...
Atea Pharmaceuticals Reports Data Supporting Bemnifosbuvir, Ruzasvir Combination to Treat Hepatitis C
Atea Pharmaceuticals Reports Data Supporting Bemnifosbuvir, Ruzasvir Combination to Treat Hepatitis C
Nov 7, 2025
09:00 AM EST, 11/07/2025 (MT Newswires) -- Atea Pharmaceuticals ( AVIR ) said Friday that new modelling data support the fixed-dose combination of bemnifosbuvir and ruzasvir to treat Hepatitis C. The company said the combination reached near-complete inhibition of viral replication and assembly, and secretion into the bloodstream, with a time to cure of approximately seven to eight weeks. The...
Auna Closes $765 Million Debt Refinancing
Auna Closes $765 Million Debt Refinancing
Nov 7, 2025
09:25 AM EST, 11/07/2025 (MT Newswires) -- Auna ( AUNA ) said Friday that it had completed a $765 million debt refinancing to extend maturities, cut interest expenses, and support cash flow for future growth. Auna ( AUNA ) and its co-issuer Oncosalud jointly issued $365 million in 8.75% senior secured notes due 2032, as well as a $400 million...
DalFort Capital Partners Completes Second Add-On Acquisition for the Polymer Adhesives Platform
DalFort Capital Partners Completes Second Add-On Acquisition for the Polymer Adhesives Platform
Nov 7, 2025
DALLAS, Nov. 7, 2025 /PRNewswire/ -- Polymer Adhesives Holdings, LLC (Polymer Adhesives), a portfolio company of DalFort Capital Partners, has acquired Fielco Adhesives (Fielco), a Huntingdon Valley, PA-based manufacturer of industrial epoxy adhesive solutions. Fielco's products serve a broad array of applications, including abrasive converting, industrial brushes, paint rollers, grinding wheels, and electronic encapsulation, among others. The combination of Polymer...
Copyright 2023-2026 - www.financetom.com All Rights Reserved