Six months later, Sino-U.S. relations have once again hit a freezing point.
Is Trump Acting Recklessly?
On Friday, October 10 (U.S. local time), U.S. President Donald Trump issued a strong statement on social media, declaring that the United States would implement the most severe economic countermeasures in history. He plans to impose an additional 100% tariff on Chinese goods, effective November 11, 2025, on top of existing tariffs.
According to Trump’s post, the强硬言论 primarily targets the Chinese Ministry of Commerce’s recent restrictions on rare earth exports. On October 9, the Ministry of Commerce released two announcements strengthening export controls on rare earth-related items. The announcements explicitly stated that any overseas products containing Chinese components or produced using Chinese rare earth-related technologies would require approval from the Chinese government for export in the future.
Market analysts note that heavy rare earth elements such as dysprosium, samarium, and terbium are critical to the performance of everything from electric vehicles to semiconductor manufacturing. If rare earth controls take effect, U.S. industries like AI, defense, and high-end manufacturing could face “supply bottlenecks at the atomic level.”
Notably, shortly before the Ministry of Commerce’s announcement, Trump had declared on social media (September 25) that he would impose industry-specific tariffs ranging from 25% to 100% on imported goods such as kitchen cabinets, effective October 1. While these tariffs were not exclusively targeting China, data from Huachuang Securities Research shows that the U.S. imported related products worth $10.16 billion from China in 2024. Since the beginning of this year, Trump has already imposed 54% tariffs on Chinese goods (with 24% temporarily suspended).
Some analysts believe that the recent frequent moves between China and the U.S. may signal a new round of trade war. Others argue that Trump’s tactics often involve bluffing and intimidation to maximize gains in negotiations.
Impact on Photovoltaic Enterprises
If U.S. tariff policies escalate further, the Trump administration may strengthen measures targeting China’s photovoltaic (PV) industry.
- In April, the U.S. issued a final ruling on anti-dumping and anti-subsidy investigations against four Southeast Asian countries (Cambodia, Thailand, Malaysia, and Vietnam), rendering PV cells from these countries economically unviable for export to the U.S. and causing a sharp decline in PV module exports to the American market.
- In July, the U.S. Department of Commerce’s Bureau of Industry and Security initiated a national security investigation into polysilicon imports. If the investigation concludes that these imports threaten national security, Trump could impose tariffs on them. Reports suggest that multiple U.S. domestic manufacturers and industry groups are lobbying to extend the investigation to include wafers and downstream products like cells and modules, potentially affecting the entire PV supply chain.
A representative from a Chinese PV module company stated, “We have become accustomed to U.S. tariff policies. Over the years, we have accumulated extensive experience in dealing with them. Even if the Sino-U.S. trade war escalates further, it will not significantly impact our company.” The representative added that compliance issues are now the core of competition in the U.S. market for Chinese PV companies. In the medium to long term, Chinese enterprises can continue participating in the U.S. market through technology licensing and sovereign fund holdings.
It is worth noting that Longi Green Energy recently indicated in investor communications that it is considering reducing its stake in a U.S. joint venture factory to comply with the requirements of the U.S. “Big Beautiful Bill”.
Will A-Shares Face a “Black Swan” Event?
While Chinese PV companies appear unfazed by Trump’s强硬言论, the A-share market and PV stocks may experience some impact on Monday (October 13).
Following Trump’s statement, major U.S. stock indices plummeted. As of the close on Friday (U.S. local time), the Nasdaq, S&P 500, and Dow Jones indices fell by 3.56%, 2.71%, and 1.90%, respectively.
Yang Delong, Chief Economist at Qianhai Kaiyuan Fund, told Southern Metropolis Daily that the sharp decline in U.S. stocks was due to investor concerns about deteriorating trade relations between major economies. He predicted that the drop in U.S. stocks would negatively impact A-shares and Hong Kong stocks in the coming week, particularly affecting Monday’s market opening.
A research report from Zhongtai Securities expressed similar views: “Trump’s strong remarks on social media and his threat to impose ‘massively increased tariffs’ on Chinese goods may pose significant short-term risks. Currently, it is advisable to focus on sectors less affected by Sino-U.S. tensions, such as dividend-yielding stocks, particularly cyclical sectors benefiting from anti-internalization policies”.
As for the PV sector, since its low point in early April, the CSI Photovoltaic Industry Index (931151) has surged by 55.81%. According to East Money data, as of October 10, the average price-to-earnings (PE) ratio of the PV equipment industry was 33.18x, significantly higher than the low of 15.61x in 2024.
