Following President-elect Trump’s announcement of his plan to impose an additional 10% tariff on Chinese goods, the Ministry of Finance (MOF) of the People’s Republic of China (PRC) released a draft proposal that gives domestically produced items a 20% price evaluation advantage in government procurement. According to DigiTimes Asia, while this move was primarily an answer to America’s proposed import taxes, it will affect all non-Chinese products, making them less competitive versus locally produced goods.
However, even though this 20% advantage applies to any item manufactured within China, the MOF proposal primarily focuses on industrial manufacturing goods, except for agricultural, forestry, animal husbandry, fishery products, and mineral resources. Experts also say this policy targets American products sold in China, which could negatively impact some of the largest chipmakers, like Intel and Nvidia. This is especially true as China remains one of the bigger markets despite the numerous and ever-increasing sanctions the U.S. has applied to Beijing.
