China struck back in the present rumblings of a trade war. The country targeted the FedEx Corp. in its escalating battle with the U.S., giving a hint of which foreign companies it may blacklist as “unreliable.”
Chinese officials are due to announce their position on trade talks with the U.S. on Sunday. And the investigation into FedEx’s “wrongful delivery of packages” was sent as a warning by Beijing after the Trump administration imposed a ban on business with telecom giant Huawei Technologies Co.
The latest move signals there’s no pause in sight in the struggle between the world’s two biggest economies at a time when trade talks have broken down. Chinese retaliatory tariffs on U.S. imports started on Saturday in Beijing, affecting more than 2,400 goods that face levies of as much as 25% compared with 10% previously.
FedEx apologized this week for delivery errors on Huawei packages following reports that parcels were returned to senders. China’s biggest tech company said it’s reviewing its relationship with the U.S. delivery service. Two packages containing documents being shipped to the company in China from Japan were diverted to the U.S. without authorization, Reuters reported.
China began the investigation because FedEx violated Chinese laws and regulations and harmed customers by misdirecting packages, the state-run Xinhua News Agency said Saturday.
“Now that China has established a list of unreliable entities, the investigation into FedEx will be a warning to other foreign companies and individuals that violate Chinese laws and regulations,” China Central Television said in a commentary.
China previously said Friday it will draw up a list of “unreliable entities” that harm the interests of Chinese companies. That could begin a process of targeting a broad swathe of the global tech industry, from U.S. giants like Alphabet Inc.’s Google, Qualcomm Inc. and Intel Corp. to non-American suppliers that have cut off Huawei, such as Toshiba and Arm.