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We don't need to relitigate the merits of tariffs here. As I understand it, tariffs are generally considered a bad tax and even if you want to support your infant industries, subsidies may work better than tariffs. My question then is, why do so many countries still use it, especially in relations to China?
This is political, economical and geopolitical question, especially in case of China.
Just for the scale of Chinese manufacturing, entirety of China has more robots in manufacturing than the continent of Africa.
When it comes to some sectors - especially sectors where capital equipment can have dual use, private industry and military use, Chinese companies aren't so different than essentially being an arm for the CCP and PLA.
For example, take COSCO, one of the biggest shipping companies around.
COSCO has a significant number of its ships built by Jiangnan Shipyards, which also builds ships for Chinese Navy. That's okay. But Jiangnan also does other things as containerized missile launchers, etc.etc.
This was from a recent tweet
And that is just one example. China has literally hundreds of such companies. So, this is your geopolitical answer.
Next comes your political answer.
It was expected that with Chinese integration into the world's systems, China ultimately would become more democratic and loosen its control. Yes, that was the path China was on, till Xi Jinping came to power. Then it was all reverted. Till 2011, economists and advisors were encouraged by CCP to have opposing views and a healthy discussion was valued. Not so anymore. Ever since the property bubble thing, and deflationary pressures China is facing internally - Chinese government stopped giving out important data regarding employment, it's local manufacturing manager's confidence, etc.etc. About 79 different data that were regularly posted on government websites have disappeared.
Economists and advisors are strongly encouraged to not use the words 'slowdown', 'deflation', 'lack of internal demand' and a laundry list more.
Democracies, which a majority of nations doing business with China are - prefer doing business with other democracies more. It may or may not happen often due to how the real world is, but it does.
This political climate of CCP clawing back power and making China a more state les economy than a market led economy, is having knockdown effects in other regions. US accounting firms and law firms have been targeted under a new national espionage law, and basically they cannot do their due diligence anymore for Chinese companies wanting to list on US markets, and 'urging' them strongly to list in China. This presents another problem, Chinese companies invite Western money managers to invest on Chinese stock market, but getting money out of China is a nightmare. This prevents Chinese - Western companies partnering and limits access of Western companies to Chinese markets, and leaders are just waking up to this now, and limiting access to western markets to Chinese firms directly, and it is hard to do that in the way China does, so tariffs are one way to do that.
That becomes your political answer.
This is the economic answer.
For every $1 spent on investing in manufacturing in Western Europe has about $15 worth of economic activity. Every $1 spent in America has about $18 worth of economic activity. In countries like India, Vietnam, Bangladesh the economic activity ratio is more like 1:50, in Africa it is a stupendous 1:100 .
So why would governments not want to rather have manufacturing at home, rather than in China? Yes, US policy was incredibly stupid about off shoring to China for some 30 years.
Then, the next issue is China's manufacturing size. Due to a lack of domestic demand which is - due to low social nets, local governments not getting a bigger pie from tax revenues, Beijing depressing local currency by manipulation (Chinese money supply has grown by over 23000 times, YES, twenty-three thousand TIMES) since the 1950s. Chinese manufacturing is subsidized in a major way by depressing the yuan, and not to mention local government subsidies in terms of electricity, low taxes on manufacturing, and low or zero interest loans for national champion industry areas, and plenty more subsidies which are often disguised.
Look, China will take back those once the industry is up and running, at which they have to increase prices (which is already visible in electronics assembly, which is flying to Vietnam, India, and some to Africa), and ultimately more or less become available at the prices your local companies would have put out products at. But at that point there are no local industries anymore. (Look at Venezuela history, a significant number of its problems were due to lack of industries, because their currency was so highly valued, they just imported everything.)
Now, there wouldn't be so many taxes or tariffs on Chinese goods, if the subsidies offered in China were more or less equal to subsidies offered elsewhere. But, that is not the case. Chinese industry isn't competing against domestic industry of any other nation, just on the basis of technology or its cheaper labor (not true anymore, but only true for high income countries), or its infrastructure which makes it easier to produce goods, or some natural advantages (like ore reserves, or oil reserves or climate eg. colder climates for say, data centers) it is competing and destroying local industry worldwide based on massive subsidies offered by Beijing and subsidies in other forms from local governments. Which is causing unemployment and destroying economies. Thus, tariffs.
This is the economic answer.
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