The United States has upped the ante in the US China trade war, now imposing a 34% tariff on Chinese imports. This new tariff follows hot on the heels of a prior 20% tariff. This latest action has caused China to respond by matching the move with a corresponding 34% tariff on all US exports. As tensions rise, US President Donald Trump has threatened to impose an additional 50% tariff on Chinese goods unless Beijing reverses its latest measures.
The US clamors for more—all while slapping new tariffs on them, scheduled to go into effect Wednesday. Though unlikely, this move would severely aggravate the already-stressed economic relationship between the two countries. This unilateral trade war declared by the U.S. has begun a wave of retaliatory tariffs. Both countries have taken turns imposing punitive tariffs on each other for more than a year. In response to the US’s primary 20% tariff, China didn’t hesitate to retaliate, immediately raising its tariffs by 34% on US products.
In response to China’s actions, President Trump issued a stark warning:
“If China does not withdraw its 34% increase above their already long term trading abuses by tomorrow, April 8th, 2025, the United States will impose additional tariffs on China of 50%, effective April 9th.” – Donald Trump
The Chinese government has pledged to be prepared to “fight to the end” should the US persist in its allegedly aggressive posturing. China’s official state news outlet, Xinhua, today lashed out at the US’s added approach as “crazy beyond description.” They said it represents an example of coercive diplomacy, not real negotiation.
“Utterly absurd is the underlying logic of the United States: ‘I can hit you at my will, and you must not respond. Instead, you must surrender unconditionally’,” Xinhua reported.
Internationally, reactions are beginning to unfold. In retaliation, the European Commission has proposed enacting EU counter-tariffs of 25% across thousands of US goods. They’ve done themselves no favors by saying they’re ready to negotiate a “zero for zero” concession with the Trump administration. Maros Sefcovic, the EU trade commissioner, stated:
“Sooner or later, we will sit at the negotiation table with the US and find a mutually acceptable compromise.” – Maros Sefcovic
Japan’s Nikkei index jumped by over 6%. This increase came on the heels of a deal struck between Trump and Japanese Prime Minister Shigeru Ishiba to begin bilateral trade negotiations. If true, this could be the beginning of a new alliance as US-China tensions heat up.
Taiwan has recently joined the fray, making it clear that they are ready to negotiate with the US at a moments notice. Taiwan’s President Lai Ching-te made the zero-tariffs proposal, which would remove barriers to trade and promote higher levels of investment into the US. Taiwan is currently served a reciprocal tariff of 32% from the US making its path to favorable trade negotiations much more difficult.
The bigger story of these tariffs goes beyond US-Chinese relations. They pose a dangerous threat to global markets. The US has slapped on tariffs between 10 and 50%. This impacts all of US trading partners and raises fears of an increasingly vicious cycle of retaliation.
Each of these developments greatly complicates an already contentious transatlantic trade relationship. The threat of tariffs on alcoholic beverages imported from the European Union is quickly turning into an imminent worry. The EU’s resolve to protect its economic interests may yet be tested. At first glance, its proposal for countermeasures is a response to the United States’ growingly protectionist direction.
As all this transpires, from both Washington’s and Beijing’s perspectives both sides are digging in, positioning themselves for what appears to be a long-term standoff. Today, the way forward still looks unlikely, with demands for compromise drowned out by further threats of economic sanctions.