By Solomon 
The trade war between the U.S. and China just heated up again. Right after President Trump slapped a 10% tariff on Chinese goods, China hit back with its own tariffs and launched an antitrust investigation into Google.
China’s market regulator announced Tuesday that it’s looking into Google for alleged antitrust violations. At the same time, Beijing rolled out 15% tariffs on U.S. coal and liquefied natural gas (LNG) and 10% on oil and agricultural equipment.
China’s Finance Ministry didn’t hold back, saying the U.S. is breaking World Trade Organization rules with its “unilateral” tariffs and that the move won’t solve anything—it’ll just hurt economic ties between the two countries.
This all happened almost instantly after the U.S. tariffs took effect. That’s different from what happened with Mexico and Canada, which got a temporary break from similar tariffs after making separate deals with Trump.
Over the weekend, Trump also signed an order demanding that China’s Communist Party crack down on criminal organizations trafficking illegal drugs.
China’s response didn’t stop at tariffs. Other measures included:
- Export controls on tungsten-related materials
- Adding PVH Corp. (which owns Calvin Klein) and biotech firm Illumina Inc. to its “unreliable entity list”
The financial markets reacted fast. The U.S. dollar went up, the offshore Chinese yuan dropped 0.3%, and the Australian and New Zealand dollars—both tied closely to China—slid about 1%. Other Asian currencies like the Thai baht and Indonesian rupiah lost some of their earlier gains.
As for Google, its main search and internet services haven’t worked in China since 2010, but the company still operates there, mainly through its advertising business.
On the energy front, the U.S. supplied about 6% of China’s LNG imports last year, according to shipping data.
Trump’s new tariffs, which took effect just after midnight on Tuesday, are part of a broader effort to punish China for what he says is its failure to stop illegal drug shipments. His order also includes a clause that would hike tariffs even further if China retaliates—which it already has.