China’s Ministry of Commerce recently launched an investigation into the United States based on the Rules on Investigating Foreign Trade Barriers. Beijing explicitly stated that this action is a “reciprocal response” to the recent Section 301 investigation initiated by the U.S. against China, signaling a renewed escalation in bilateral economic and trade confrontations.
The Chinese probe focuses on 2 primary aspects. The first alleges that the U.S. has severely damaged the trade interests of Chinese enterprises through export controls and bilateral investment restrictions. The second targets various U.S. trade measures regarding green products, including steep tariffs imposed under the Biden administration on Chinese electric vehicles (EVs), lithium batteries, and solar panels—with EV tariffs surging as high as 100%. China contends that these unilateral American measures not only distort the operation of global supply chains and pose substantial barriers to the green product trade but also violate World Trade Organization (WTO) regulations.
The timing of China’s investigation carries profound political significance. Trump was originally scheduled to visit China in April for a landmark summit with Chinese President Xi Jinping. However, when the U.S. demanded Beijing’s cooperation on sanctions against Iran, China refused. Divergent stances on this issue prompted Trump to postpone his visit to May, sparking dissatisfaction in Beijing. As uncertainties loom over high-level engagements, the simultaneous escalation of trade frictions indicates that economic issues have become critical bargaining chips and pressure tools ahead of negotiations.
Looking back to October 2025, when the U.S. and Chinese leaders met in South Korea, they reached a temporary truce in the tariff war and established a one-year negotiating period. Despite some advancements, tensions have escalated regarding excess capacity, supply chain security, and labor rights. This illustrates that the structural contradictions between the two powers have not only persisted but have become more pronounced.
In fact, the U.S. recently rebooted its Section 301 investigation to probe the “excess capacity” problem across 16 trading partners, including China. The move squarely targets unfair competition fueled by Chinese state policy support in sectors such as EVs, steel, and solar energy. Concurrently, the U.S. has institutionalized the issue of “forced labor,” closely intertwining human rights with trade policy. Although 16 trading partners fall under the U.S. probe, China is undoubtedly the primary target.
By launching its own trade barrier investigation, China is using legal frameworks to accuse U.S. measures of violating multilateral norms while simultaneously developing its own institutionalized retaliation mechanism, which normalizes the bilateral trade conflict. Notably, in 2023, China initiated a similar trade barrier probe against Taiwan for long-standing import restrictions on 2,455 products. Subsequently, it suspended tariff concessions on 146 items under the Economic Cooperation Framework Agreement (ECFA) as a concrete countermeasure, demonstrating that this mechanism has become a pivotal tool for Beijing to exert external economic pressure.
The U.S. and China are gradually descending into “institutional confrontation.” The U.S. employs the Section 301 investigation to tighten external constraints on Chinese industrial development, while China utilizes trade barrier investigations to counter U.S. pressure. Trade policies have transcended their role as mere market instruments, becoming core weapons in geopolitical competition. More notably, both sides have integrated non-economic issues into their trade frameworks: the U.S. emphasizes human rights, supply chain security, and national security risks, whereas China appeals to industrial development and supply chain stability. This trend makes it increasingly difficult for existing multilateral rules to mediate conflicts, further eroding the binding authority of the WTO.
Under the U.S.-China confrontational paradigm, Taiwan can no longer stay on the sidelines. It stands squarely at the crossroads of the wrestling match between the “two elephants.” When institutions and rules form the core of competition, policy shifts from either side can translate into tangible pressure on Taiwan. Particularly when two superpowers clash, the critical nodes caught in between are often the most vulnerable to impact. For Taiwan, the key lies not in choosing sides but in making early strategic preparations and fortifying resilience. Only then can Taiwan maintain agency within this great power game and avoid absorbing excessive shockwaves.
Source: Da-Nien Liu (April 20, 2026). From Section 301 to Trade Barriers: The U.S.-China Strategic Rivalry. United Daily News. https://udn.com/news/story/7340/9446902