China’s retaliation for President Donald Trump’s tariffs has thus far included a levy on imported American energy products, an extra fee on imported American agricultural equipment, and a menacing “antitrust” investigation of Google.
The Chinese are threatening a few other American companies as well, but Google looks like the biggest target so far. The Chinese government has been gunning for Google since 2010, when the Internet giant began resisting the Chinese Communist Party’s censorship orders.
Google moved much of its operation from China to Hong Kong and the company soon found itself on the far side of China’s notorious “Great Firewall,” a formidable network of censorship designed to make Western websites and social media platforms inaccessible to the Chinese population.
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Google made a few attempts to get back into China in the late 2010s, including work on a search engine just for China and an artificial intelligence research center, but those projects were later abandoned.
Google still has a few offices in China, mostly selling advertising and cloud services. Many Chinese companies with big international markets, such as e-commerce giants Temu and Shein, pay for heavy advertising on Google.
Somehow the State Administration for Market Regulation in Beijing contrived an “antitrust” investigation into these limited activities on Tuesday, literally within minutes of Trump’s tariffs taking effect. No details of the allegations were provided.
The Associated Press (AP) quoted analysts who suspected the antitrust investigation will target Google’s popular smartphone operating system, Android. Most Chinese smartphone companies license Android for their products, although one of the biggest players, Huawei, developed its own system after the company was hit with U.S. sanctions in 2019.
University of Southern California law professor Angela Zhang told the South China Morning Post (SCMP) on Wednesday that China “fired a warning shot to Washington” with its Google antitrust probe, “signaling its readiness to retaliate.”
Huawei’s HarmonyOS has made some inroads, and Apple has its fans, but Android still holds over 75 percent of the market. The antitrust investigation could be intended to signal that China’s rulers are ready to take actions that would damage their own consumers.
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Bloomberg News analysts took the opposite view, suggesting Chinese dictator Xi Jinping wanted “carefully calibrated” retaliation that would “avoid major blowback on China’s economy while showing Trump an ability to inflict damage on a range of fronts.” Google is high-profile in Western media, guaranteeing headline news coverage for the anti-trust operation, but so far Beijing has done little except issue a press release.
Two other companies were targeted by China on Tuesday, genetic sequencing company Illumina and PVH, parent company of the Tommy Hilfiger and Calvin Klein brands. Both were put on a blacklist by the Chinese Ministry of Commerce, ostensibly for taking “damaging actions against Chinese companies.”
PVH is viewed with animosity by the Chinese Communist Party for boycotting cotton that could be tainted with forced labor from the Uyghurs of occupied East Turkistan, while Illumina might have been chosen because it competes with a major Chinese biotech firm called BGI that was scrutinized by U.S. regulators last year.
Being added to the blacklist carried no further immediate penalties for either company, although it makes them eligible for destructive punitive actions. Illumina, already suffering from regulations designed to make its products more expensive for Chinese consumers, took a 5 percent hit on the Nasdaq exchange after the blacklisting was announced.
