China Urges U.S. to Drop Proposed Ban on Chinese Car Components

China's commerce ministry has urged the U.S. to drop proposed restrictions on Chinese auto software and hardware, saying it will take the "necessary measures" to protect national companies.

The Ministry of Commerce said China firmly opposes the restrictions, which it described as protectionist practices with no factual basis that go against the principles of a market economy and fair competition.

"The U.S. actions also involve the use of government power to interfere with business and economic cooperation, constituting economic coercion," the ministry said in a statement on its website.

In February, the U.S. Department of Commerce announced an inquiry into the potential national security risks posed by Chinese smartcars, software and other parts. The plan was pushed forward this week as the Commerce Department proposed a ban on Chinese auto products and services.

China's commerce ministry said it is wrong to generalize national security issues and urged Washington to stop its "unjust oppression" of Chinese companies.

It said it will act to defend the interests and rights of Chinese companies, without specifying details.

The move comes amid increasingly tense trade relations between the two countries. Beijing on Tuesday announced a probe into PVH, which owns Calvin Klein and Tommy Hilfiger. The investigation could potentially block the American apparel firm's sales in China, which follows steps by the U.S. to limit Chinese access to its market.

The Biden administration has turned to measures like raising tariffs on electric vehicles to counter what it sees as threats from China in U.S. markets.

The U.S. Commerce Department on Monday proposed banning the use of Chinese and Russian components in connected vehicles on U.S. roads. The Biden administration said earlier this month that it would take executive action to limit the use of a trade provision that lets China-founded e-commerce firms like Shein more easily ship to the U.S.

Others have followed suit, with the European Union and Canada also raising tariff barriers against Chinese goods.

If the tit-for-tat trade measures continue, that could pose a risk for China's economy, which has leaned heavily on exports strength as other areas falter, some analysts say.

Write to Singapore editors at singaporeeditors@dowjones.com

(END) Dow Jones Newswires

September 25, 2024 05:59 ET (09:59 GMT)

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