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Home » Trump’s Trade War Escalates as China Retaliates With 34% Tariffs

Trump’s Trade War Escalates as China Retaliates With 34% Tariffs

April 4, 20254 Mins Read Business
Trump’s Trade War Escalates as China Retaliates With 34% Tariffs
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China has struck back at President Trump.

In a rapid fire series of policy announcements from Beijing on Friday evening, including 34 percent across-the-board tariffs, three government agencies showed that China has no intention of backing down in the trade war that Mr. Trump began this week with his own steep tariffs on imports from around the world.

China’s Finance Ministry said it will match Mr. Trump’s plan for 34 percent tariffs on goods from China with its own 34 percent tariff on imports from the United States.

Separately, China’s Ministry of Commerce said it was adding 11 American companies to its list of “unreliable entities,” essentially barring them from doing business in China or with Chinese companies. The ministry imposed a licensing system to restrict exports of seven rare earth elements that are mined almost exclusively in China and are used in everything from electric cars to smart bombs.

The commerce ministry also announced it was beginning two trade investigations into American exports of medical imaging equipment — one of the few manufacturing categories in which the United States remains internationally competitive.

China’s General Administration of Customs said that it would halt chicken imports from five of America’s biggest exporters of agricultural commodities and sorghum imports from a sixth company.

China’s new tariffs will hit fewer goods than President Trump’s tariffs only because China sells far more to the United States than it buys. China bought $147.8 billion worth of American semiconductors, fossil fuels, agricultural goods and other products last year. It sold $426.9 billion worth of smartphones, furniture, toys and many other products.

But while President Trump’s tariffs exempted some large categories of imports, like semiconductors and pharmaceuticals, the Chinese tariffs have no exemptions.

China’s Finance Ministry issued a statement strongly criticizing Mr. Trump’s tariffs, which will begin to take effect on Saturday and fully kick in next Wednesday. “This practice of the U.S. is not in line with international trade rules, seriously undermines China’s legitimate rights and interests, and is a typical unilateral bullying practice,” the ministry said.

The Chinese tariffs are scheduled to take effect next Thursday — 12 hours after the American tariffs take effect.

Jude Blanchette, director of the RAND China Research Center, said China’s forceful response was “inevitable” after Mr. Trump introduced his sweeping tariffs.

“Beijing can no longer maintain the fiction that diplomatic engagement with the Trump administration will prevent a full-scale trade war,” Mr. Blanchette said. “Despite White House warnings against retaliation, the total tariffs imposed on China are now so substantial that Beijing has little reason to exercise restraint.”

The escalatory cycle also further dims hope of any summit soon between Mr. Trump and China’s top leader, Xi Jinping. Mr. Xi’s aides have been wary of scheduling any meeting between the two men unless a detailed agenda and resolution of pending issues can be worked out in advance.

Friday’s countermeasures highlight China’s retaliatory toolbox at its disposal, one reason Beijing feels it is better prepared to weather a trade war with the United States today than it was during the first Trump administration, said Wang Dong, executive director of the Institute for Global Cooperation and Understanding at Peking University.

“If the Trump administration’s hope is to pressure China to cave in, then it’ll be a non-starter,” he said.

Mr. Wang said Beijing is also betting that Mr. Trump will come under growing pressure at home to ease some of his tariffs because of the harm it might do to the U.S. economy.

“China is in a better position to win this round of trade frictions,” Mr. Wang said.

Mr. Trump has contended that steep tariffs are essential to halt a long decline in America’s share of global manufacturing, by protecting the American market from a flood of imports. The White House has also said that the tariffs are needed to preserve the remaining industrial capacity of the United States to make munitions in case of military conflicts.

China’s restrictions on exports of rare earth metals may echo a similar, two-month freeze on such shipments to Japan in 2010 during a territorial dispute, although that export embargo was never published but was handled instead through direct orders to companies with export quotas.

This is a developing story. Please check back for updates.

Claire Fu contributed reporting from Seoul.

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Mideast Conflict Imperils a Tiny Waterway Vital to the World Economy

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