US 'forced labour' tariffs unjustified, amount to protectionism: China

China's ??commerce ministry said on Monday that new ​US tariffs imposed on Chinese goods over alleged forced labour were unjustified and amounted to protectionism, and urged Washington ??to remove them. On Friday, the United States imposed new tariffs of 10 per cent and 12.5 per cent on goods from 60 trading partners, including the EU and China, alleging those countries failed to curb ‌imports made by forced labour. China was assigned ​a 12.5 per cent rate.  The new US ​duties could risk undermining a fragile trade truce reached between the world's two largest ​economies last year and came as the two sides prepare for a possible visit to the US by Chinese President Xi Jinping in September.

 

  The commerce ministry in a statement accused Washington of long manipulating the issue of forced labour, calling the new tariffs a ​typical act of unilateralism and protectionism, but also signalled willingness to continue dialogue "based on mutual respect, ‌equality and mutual benefit" to address concerns.

  "This time, it (Washington) has again initiated ​a Section 301 investigation and imposed unilateral tariffs on the grounds of 'forced labour,' which is a typical act of unilateralism and protectionism, and China firmly opposes it," the ministry said.

  "China has consistently opposed ‌forced labour and has established a ​comprehensive system of labour laws and regulations to ‌resolutely prevent and combat forced labour practices. In contrast, the US has not ‌only ??failed to ratify the 1930 Forced Labour Convention, but has also long manipulated the issue ​of "forced labour"".

  It said Washington had pledged during trade talks that replacement tariffs on Chinese goods would not exceed 20 per cent, noting that the new ​12.5 per cent tariff imposed under the forced-labour probe remained within that limit.

  "China urges the US to correct its erroneous practices and completely remove the relevant ‌unilateral tariff measures," the ministry said.

  It said it reserved the right to take all necessary ‌measures as it assessed further US actions.

  "It is hoped the US will work with China to uphold and implement the consensus reached in the trade consultations, continuously reduce the problem list and lengthen the cooperation list," the ministry said. 

China accuses America of ‘AI hegemonism’

China's commerce ministry on Monday accused the United States of "AI hegemonism" and threatened countermeasures after senior US officials said Chinese AI companies could face investigations, ??sanctions and trade restrictions over the alleged theft of US technology. 

The ministry said Washington was threatening Chinese companies with punishment based on allegations they used "distillation" to copy advanced US AI models, despite what it called a lack of factual or legal grounds. 

Model distillation is ‌a widely used AI training technique in which developers use ​the outputs of a more capable model to train ​or improve another system. US officials say they distinguish between legitimate distillation and large-scale extraction that amounts to intellectual property ​theft.

 

All necessary measures

"For any action that causes substantive harm to Chinese interests, China will take all necessary measures to firmly safeguard its legitimate rights and interests," a ministry spokesperson said in a statement. 

The comments mark an escalation in a dispute centred on Beijing-based Moonshot AI, whose recently released Kimi K3 model has drawn attention for its coding capabilities and intensified debate in Washington over ​whether Chinese developers are copying US models or rapidly closing the technological gap through their own research. The controversy echoes the reaction ‌in the US to the rise of Chinese startup DeepSeek last year. 

White House Office of Science and Technology ​Policy Director Michael Kratsios said last week the US government had information indicating Moonshot distilled Anthropic's Claude Fable 5 model to develop Kimi K3. 

Kratsios alleged Moonshot had built a sophisticated internal platform to conduct large-scale distillation of US models and switched between multiple methods of access to avoid ‌detection. He also alleged the company had acquired servers ​equipped with Nvidia's GB300 chips and accessed such systems in ‌Thailand, likely to train its models. 

US Treasury Secretary Scott Bessent later warned that Chinese companies could face financial sanctions or ‌placement ??on the Commerce Department's Entity List, which restricts access to US technology. 

"We support open-source AI and the innovation it unlocks. But ​open source is not open season on American IP," Bessent wrote on social media platform X.

  "When PRC (Chinese) firms conduct covert, industrial-scale distillation attacks that cross the line into IP theft, sanctions and Entity ​List designations will be on the table," he said.

  Moonshot has rejected suggestions that Kimi K3's performance was achieved via distillation, telling China's National Business Daily last week that its performance gains came from original changes to ‌underlying architecture. 

Placement on the Entity List could severely restrict Moonshot's access to US semiconductors, software and cloud services. The US used ‌the trade blacklist as a central part of its campaign against Chinese telecommunications equipment maker Huawei beginning in 2019.

  Anthropic said in February it had identified more than 3.4 million interactions with its Claude models linked to Moonshot. It said hundreds of fraudulent accounts were used to target capabilities including reasoning, coding, data analysis, tool use, computer vision and the operation of computers.