The punitive tariffs imposed by Washington and Beijing last Friday have sparked widespread fears that a trade war will severely damage the global economy and could have a predominantly negative effect on several aspects of the US market itself.
Both countries have imposed a 25% tax on $34bn worth of goods produced by the other, a move initially catalysed by President Trump’s accusations that China has been stealing American intellectual property.
For the most part, the tariffs are not intended to affect consumer goods, with the focus mainly on industrial, medical and agricultural devices and technologies. More than 800 items are on the list, including boats, aircraft engines, semiconductors and nuclear apparatus.
The Chinese nuclear energy imports affected include thorium compounds, uranium compounds depleted in U235, alloys, nuclear reactors, and machinery for isotopic separation.
Concerns have been raised over the threat such levies pose to the semiconductor industry, as well as on hopes that the budding nuclear power sector in China will assist the US to produce more cost-effective reactors.
US commentators have warned that upsetting relations with China would be unwise given the vast potential offered by the country’s nuclear industry. President Xi Jinping’s attempts to reduce pollution and reliance on coal include plans to build up and expand existing infrastructure with a renewed focus on nuclear power, with at least 100 nuclear plants planned for construction through 2030.
While Xi has vocalised a desire for China to become self-sufficient in its production and development of nuclear facilities and machinery, the country is still heavily reliant on foreign imports of uranium and other equipment needed in the construction of plants. According to government data, US companies supplied China with around 30% of its enriched uranium imports in 2015.
In a bid to reduce coal dependence, the Chinese Government is actively promoting nuclear power as a clean, efficient, and reliable source of electricity generation. The sector is predicted to grow to 58 GWe by 2020 and 150 GWe by 2030, with six to eight new nuclear plants expected to be built each year during the country’s 13th Five-Year Plan period (2016 to 2020).
As such, China remains a massive potential market for US companies involved in any aspect of nuclear power development. The proposed tariffs have sparked criticism from Republicans and conservative groups, with the main concern being that US tariffs on nuclear products will cause further retaliation from China and exclude the US from a rapidly blossoming industry.