China's Legislature Enacts Tariff Law Amid Trade Tensions

China's top legislature has enacted a Tariff Law set to be effective from December 1, 2023, as part of an effort to enhance its trade defense mechanisms. This law, which follows three rounds of legislative deliberations dating back to 2022, equips China with the legal capacity to impose retaliatory tariffs on imports and exports. This legislative step also defines tax incentives and asserts China's rights to respond to trade agreement violations by other countries.

The passage of the Tariff Law comes against a backdrop of ongoing trade tensions with major economic partners such as the United States and the European Union, particularly over issues of industrial overcapacity. The law is viewed as a component of China's broader strategy to assert its trade interests and respond to the trade practices of other nations that it deems unfair or detrimental to its own economic interests. This legislative move is indicative of China's proactive stance in safeguarding its trade position amidst global economic challenges and shifting international trade dynamics.