Amid escalating trade tensions and the imposition of sweeping 125% tariffs on U.S.-made products, China is reportedly compiling a confidential list of American goods that will be exempt from these duties, according to sources familiar with the matter.

The exemptions are targeted and strategic, aiming to shield key Chinese industries from supply disruptions. Among the goods being excluded are semiconductors, aviation components, medical devices, and ethane — all critical to China’s high-tech manufacturing, healthcare, and petrochemical sectors. Ethane, in particular, is vital for plastic production, and China remains heavily reliant on U.S. supplies.

Rather than publicly announcing the exemptions, Chinese authorities are quietly notifying select importers and companies, many of which had expressed concern over the economic fallout from the sweeping tariffs. Officials have also begun surveying businesses to gather data on the potential impact of the trade restrictions and identify further items that may require exemptions.

This move comes as Beijing attempts to balance two competing pressures: responding firmly to U.S. trade actions while protecting its own economic interests and maintaining access to essential American technology and materials.

Analysts suggest the decision reflects a pragmatic approach by Chinese policymakers, who are wary of triggering further supply chain disruptions or inflation at a time when domestic growth remains fragile.

Although the exemptions signal flexibility behind China’s tough rhetoric, they also underscore how interdependent the U.S. and Chinese economies remain, even amid intensifying geopolitical friction.

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