Tariffs as a solution to the fentanyl crisis? A misguided approach

Editor's note: Zhou Mi, a special commentator for CGTN, is deputy executive director of and research fellow at the Institute of American and Oceania Study, Chinese Academy of International Trade and Economic Cooperation, the Ministry of Commerce of the People’s Republic of China. The article was first published by International Business Daily. The article reflects the author's opinions and not necessarily those of CGTN.

As Donald Trump begins his new term as U.S. President, he has made resolving the fentanyl crisis a top priority, reflecting his administration's concern over the rampant abuse of fentanyl and other opioids in the United States. The Chinese people, having suffered from the devastation of opium addiction in the 19th century, are well aware of the dangers of widespread drug dependence. However, is America's fentanyl crisis truly the result of U.S.-China trade relations? Are tariffs the right tool to solve this public health disaster?

The root causes of the fentanyl crisis lie in policy failures, regulatory loopholes and deep-seated social and cultural factors within the United States. Statistics show that while the U.S. accounts for just 5 percent of the world's population, it consumes 80 percent of the global supply of opioids, making it both the largest producer and consumer of fentanyl-based pharmaceuticals. Overprescription and misuse of opioid medications remain rampant in the American pharmaceutical and healthcare industries, which are the primary beneficiaries, with lax regulations allowing illegal production and distribution to flourish. The massive profits from illicit sales have drawn criminal organizations into the trade, while inadequate law enforcement in certain regions has further fueled the epidemic. According to a recent executive order from the Trump administration, opioid-related deaths claim approximately 200 American lives each day. Meanwhile, data from the U.S. Centers for Disease Control and Prevention (CDC) reveals that from April 2023 to April 2024, more than 100,000 Americans lost their lives due to drug overdoses. 

The scourge of narcotics in the 19th-century China is precisely why the country now has some of the strictest and most thoroughly enforced drug policies in the world. During Donald Trump's first term, China and the U.S. engaged in active cooperation on fentanyl-related issues. As a responsible major country, China made it clear that the root cause of the fentanyl crisis lies within the U.S. itself. Nonetheless, in 2019, China took the unprecedented step of implementing a class-wide regulation on all fentanyl-related substances, becoming the first country in the world to do so. Following this milestone, China adopted a series of effective measures to combat fentanyl-related trafficking. Since the implementation of class-wide controls, China has not received any reports from the U.S. of fentanyl-related substances being seized from China. However, the U.S. failed to reciprocate this cooperation. In May 2020, during Trump's first term, the U.S. Department of Commerce placed the Forensic Identification Center of the Ministry of Public Security of the People's Republic of China on its "Entity List," restricting its access to American technology and equipment. This unilateral move not only undermined the foundation of U.S.-China anti-drug cooperation but also exposed the lack of genuine commitment from the U.S. to tackling the fentanyl crisis through international collaboration. 

Now, the U.S. has once again accused China of inadequate fentanyl and precursor chemical controls, claiming that exports from China have worsened the American opioid crisis. These allegations are entirely baseless. Rather than adopting a responsible, cooperative approach, the U.S. has resorted to unilateralism, announcing a 10 percent tariff increase on all Chinese imports in addition to existing tariffs. This reaction is akin to prescribing the wrong medicine for a critical illness – it is harmful to others while offering no benefit to oneself. Such measures will only disrupt global supply chains.

As a transaction cost in international trade, tariffs serve as a mechanism for redistributing economic benefits among different parties. Lower tariffs facilitate cross-border trade, allowing businesses to optimize resource allocation on a broader scale. Conversely, higher tariffs enable importing governments to extract revenue from international transactions, introducing trade costs and uncertainties into global supply chains. As the world's largest exporter of goods, China provides a stable supply of industrial products, intermediate goods and consumer goods, ensuring market stability, high living standards for American consumers and competitiveness for American businesses. However, the tariff hikes imposed by the Trump administration will significantly increase the complexity and costs of imports for U.S. suppliers, further exacerbating inflationary pressures that have remained persistently high in recent years. 

Since the end of World War II, lowering tariffs has been a global consensus, including in the United States. From the General Agreement on Tariffs and Trade (GATT) to the World Trade Organization (WTO), along with numerous free trade agreements, each round of tariff reductions has been a hard-fought achievement. However, tariff increases and protectionist policies tend to fuel nationalist sentiment, giving policymakers a short-term sense of satisfaction by flexing their muscles and appearing "tough" on trade. This dangerous illusion of success often drowns out opposition from importers and affected stakeholders, while also masking the economic pain felt by the public due to rising inflation. Over the past eight years, there do not appear to be domestic alternatives in the U.S. to Chinese imports, including apparel, footwear, machinery and electronics. As a result, American businesses and consumers have had no choice but to continue importing these goods at higher costs, ultimately bearing the financial burden of protectionist trade policies.

On February 2, 2025, in response to the U.S. announcement of a 10 percent tariff increase on Chinese imports, a spokesperson for China's Ministry of Commerce emphasized that China hopes the U.S. will take an unbiased and rational approach to addressing its domestic fentanyl crisis, rather than resorting to tariff threats against other countries. In an announcement on February 4, the Customs Tariff Commission of the State Council of China also stated that the U.S. actions seriously violate WTO rules. The commission further stressed that such measures do nothing to resolve America's own issues but instead damage U.S.-China economic and trade cooperation. The Trump administration must recognize that economic globalization is an irreversible trend. No country, including the U.S., can achieve complete self-sufficiency, and international trade networks based on comparative advantage will continue to evolve and accelerate with technological advancements. 

The fentanyl crisis within the U.S. borders cannot be solved by shifting blame to other countries. A genuine solution requires domestic reforms – the U.S. must address its own ailments with the right approach by taking comprehensive internal action. When it comes to cross-border supply chains, relevant parties should engage in dialogue and consultation, share accurate information, distinguish between facts and misinformation and take coordinated actions within a legal, compliant and rational framework. True progress can only be made through cooperation, not confrontation.

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