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China likes to condemn the United States for extending its arm too far outside of its borders to make demands on non-American companies. But when it sought to hit back at the U.S. interests this month, Beijing did exactly the same.In expanding export rules on rare earths, Beijing for the first time announced it will require foreign firms to obtain approval from the Chinese government to export magnets containing even tiny amounts of China-originated rare earth materials or produced with Chinese technology.That means a South Korean smartphone maker must ask for Beijing’s permission to sell the devices to Australia if the phones contain China-originated rare earth materials, said Jamieson Greer, the U.S. trade representative. “This rule gives China control over basically the entire global economy in the technology supply chain,” he said.For anyone familiar with U.S. trade practice, China is simply borrowing a decades-long U.S. policy: the foreign direct product rule. It extends the reach of U.S. law to foreign-made products, and it has been used regularly to restrict China’s access to certain U.S. technologies made outside of the United States, even when they are in the hands of foreign companies.It is the latest example of Beijing turning to U.S. precedents for tools it needs to stare down Washington in what appears to be an extended trade war between the world’s two largest economies.“China is learning from the best,” said Neil Thomas, a fellow on Chinese politics at Asia Society Policy Institute’s Center for China Analysis. “Beijing is copying Washington’s playbook because it saw firsthand how effectively U.S. export controls could constrain its own economic development and political choices.”He added: “Game recognizes game.” The idea goes back to at least 2018 It was in 2018, when President Donald Trump launched a trade war with China, that Beijing felt the urgency to adopt a set of laws and policies that it could readily deploy when new trade conflicts arise. And it looked to Washington for ideas.Its Unreliable Entity List, established in 2020 by the Chinese Ministry of Commerce, resembles the U.S. Commerce Department’s “entity list” that restricts certain foreign companies from doing businesses with the U.S.In 2021, Beijing adopted the anti-foreign sanction law, allowing agencies such as the Chinese Foreign Ministry to deny visas and freeze the assets of unwelcome individuals and businesses similar to what the U.S. State Department and the U.S. Department of Treasury can do.Calling it a toolkit against foreign sanctions, intervention and long-arm jurisdiction, the state-run news agency China News in a 2021 news report cited an ancient Chinese teaching, saying Beijing would be “hitting back with the enemy’s methods.”The law “has combed through relevant foreign legislation and taken into consideration the international law and the basic principles of international relations,” said the Chinese scholar Li Qingming as quoted in the news report. He also said it could deter the other side from escalating.Other formal measures Beijing has adopted in the past several years include expanded export controls and foreign investment review tools.Jeremy Daum, a senior research scholar in law and senior fellow at Yale Law School’s Paul Tsai China Center, said Beijing often draws from foreign models in developing its laws in non-trade, non foreign-related areas. As China seeks capabilities to retaliate in kind in trade and sanctions, the tools are often “very parallel” to those of the U.S., he said.Both governments also have adopted a “holistic view of national security,” which expands the concept to justify restrictions on each other, Daum said. Things accelerated this year When Trump launched his trade war with China shortly after he returned to the White House earlier this year, Beijing readily deployed its new tools in addition to raising tariffs to match those imposed by the U.S. president.In February, in response to Trump’s first 10% tariff on China over allegations that Beijing failed to curb the flow of chemicals used to make fentanyl, the Chinese Commerce Ministry put PVH Group, which owns Calvin Klein and Tommy Hilfiger and the biotechnology company Illumina, on the unreliable entity list.That barred them from engaging in China-related import or export activities and from making new investments in the country. Beijing also announced export controls on tungsten, tellurium, bismuth, molybdenum and indium, which are elements critical to the production of modern high-tech products.In March, when Trump imposed the second 10%, fentanyl-related tariff, Beijing placed 10 more U.S. firms on its unreliable entity list and added 15 U.S. companies to its export control list, including aerospace and defense companies like General Dynamics Land Systems and General Atomics Aeronautical Systems, among others, asserting that they “endanger China’s national security and interests.”Then came the so-called “Liberation Day” tariffs in April, when Beijing not only matched Trump’s sky-high tariff of 125% but also blacklisted more U.S. companies and announced export controls on more rare earth minerals. That led to a pause in the shipment of magnets needed in manufacturing a wide range of products such as smartphones, electric vehicles, jet planes and missiles.While the new tools have allowed China to stare down the United States, Daum said they are not without risks.“The dangers in such a facially balanced and fair approach are, one, what one side sees as reciprocity the other might interpret as escalation,” he said. And second, “in a race to the bottom, nobody wins.” Didi Tang, Associated Press
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E-Commerce
China’s economy expanded at the slowest annual pace in a year in July-September, growing 4.8%, weighed down by trade tensions with the United States and slack domestic demand.The July-September data was the weakest pace of growth since the third quarter of 2024, and compares with a 5.2% pace of growth in the previous quarter, the government said in a report Monday.In January-September, the world’s second largest economy grew at a 5.2% annual pace. Despite U.S. President Donald Trump’s higher tariffs on imports from China, its exports have remained relatively strong as companies expanded sales to other world markets.China’s exports to the United States fell 27% in September from the year before, even though growth in its global exports hit a six-month high, climbing 8.3%.Exports of electric vehicles doubled in September from a year earlier, while domestic passenger car sales climbed 11.2% year-on-year in last month, down from a 15% rise in August, according to data released last week.Tensions between Beijing and Washington remain elevated, and it’s unclear if Trump and Chinese leader Xi Jinping will go ahead with a proposed meeting during a regional summit at the end of this month.Xi and other ruling Communist Party members are convening one of China’s most important political meetings for the year on Monday, where they will map out economic and social policy goals for the country for the next five years.The economy slowed in the last quarter as the authorities moved to curb fierce price wars in sectors such as the auto industry due to excess capacity.China is also facing challenges including a prolonged property sector downturn which has been affecting consumption and demand.Data released Monday showed China’s residential property sales fell 7.6% by value in the January-September period from a year earlier. Industrial output rose 6.5% year-on-year last month, the fastest pace since June, but retail sales growth slowed to 3% from the year before.Ratings agency S&P estimates nationwide new home sales will fall by 8% in 2025 from the year before and by 6% to 7% in 2026.The World Bank expects China’s economy to grow at a 4.8% annual rate this year. The government’s official growth target is around 5%.Chinese shares rose Monday, with the Hang Seng in Hong Kong climbing 2.3% and the Shanghai Composite index up 0.5%.A National Bureau of Statistics spokesman said China has a “solid foundation” to achieve its full-year growth target, but cited external complications including trade friction with the U.S. and other trading partners and protectionist policies in many countries as reasons for the slowdown.China’s stronger economic growth in the first half of this year gives it “some buffer” to achieve the growth target, said Lynn Song, chief economist for Greater China at ING Bank.However, spending during China’s eight-day Golden Week national holiday in October was “mildly disappointing,” reflecting sluggish consumer confidence and demand, Morningstar analysts said in a note this month.Investments in factories, equipment and other “fixed assets” fell 0.5% in the last quarter, underscoring weakness in domestic demand. It also was reflected in prices, which have continued to fall both at the consumer and the wholesale level.There’s room for the government to do more, Song said.“(We) are looking to see if there will be further measures to support consumption and the property market, as the impact from previous policies begins to weaken,” Song said.Economists are also expecting a rate cut by China’s central bank by the end of the year, which could encourage more spending and investment.China’s economy is also likely to further slow in 2026, said Jacqueline Rong, chief China economist at BNP Paribas, as property investment in the country “looks (to) continue falling” and the AI boom, which helped lift China’s economy and fueled a stock market rally, is expected to moderate. Chan Ho-Him, AP Business Writer
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E-Commerce
President Donald Trump said Sunday that the United States could purchase Argentinian beef in an attempt to bring down prices for American consumers.“We would buy some beef from Argentina,” he told reporters aboard Air Force One during a flight from Florida to Washington. “If we do that, that will bring our beef prices down.”Trump promised earlier this week to address the issue as part of his efforts to keep inflation in check.U.S. beef prices have been stubbornly high for a variety of reasons, including drought and reduced imports from Mexico due to a flesh-eating pest in cattle herds there.Trump has been working to help Argentina bolster its collapsing currency with a $20 billion credit swap line and additional financing from sovereign funds and the private sector ahead of midterm elections for his close ally, President Javier Milei. Christopher Megerian, Associated Press
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