China expands economic tools as US trade truce holds

China has expanded the range of economic measures it can deploy against the United States, introducing new rules and tightening existing controls since October even as a trade truce with the Trump administration remains in place.

Officials have presented the steps as a way to strengthen Beijing’s leverage in international disputes connected to what it describes as U.S. economic and geopolitical actions. The measures described span supply chains, technology access, and sanctions-related pressure.

New rules and tighter controls since October

Since October, China has put in place laws aimed at foreign entities that move supply chains, according to the source material. Over the same period, it strengthened its rare earth licensing regime.

The source material also says China imposed restrictions affecting foreign AI chips and U.S./Israeli cybersecurity software used in state-funded data centers. In addition, it says China is considering export limits on solar manufacturing equipment to the U.S., though it does not provide a timeline.

April regulations signed by Premier Li Qiang

A key development came in April, when Premier Li Qiang signed two regulations that grant authorities powers to investigate and penalize foreign firms, governments, and individuals, the source material says.

Those regulations apply to cases where targets are accused of discriminating against China’s industrial and supply chains or of enforcing extraterritorial jurisdiction against Chinese entities. The measures described include denying entry, expulsion, and asset seizure.

Iran conflict and sanctions warning cited in the account

The source material links the faster pace of these actions to the Iran conflict, saying it increased China’s focus on economic countermeasures. It also cites a warning from U.S. Treasury Secretary Scott Bessent, who threatened sanctions on buyers of Iranian oil.

China is described as importing 80% of Iran’s oil exports. In that context, the new regulations are presented as legal countermeasures that extend beyond traditional trade tools.

Business uncertainty and unresolved details

Business groups have flagged operational uncertainty. The American Chamber of Commerce in China said the regulations create an asymmetry: China can cut purchases from foreign firms with limited consequence, while foreign companies that reduce dependence on China could face investigation.

As described, that dynamic raises compliance and planning risks for multinationals managing procurement, technology stacks, and data-center deployments that touch China’s state-funded systems. The source material does not specify how broadly the new investigative and penalty powers may be applied, leaving key details unresolved.

For global markets, the measures outlined touch critical inputs and technologies, including rare earths, AI chips, cybersecurity products, and solar manufacturing equipment. The account also does not set out timelines for the contemplated solar equipment curbs, adding to uncertainty around implementation.