China Responds to Trump’s Tariff Hike with Increased Duties on U.S Goods

In escalation of the ongoing trade war, China retaliated against U.S. President Donald Trump's recent tariff imposition by raising its duties on American products to 84% as of Wednesday. This increase deepens tensions between the two economic superpowers, following Trump's announcement of a new 50% tariff on Chinese imports unless the Chinese government withdrew retaliatory tariffs.

Beijing's response also includes imposing new restrictions on 18 U.S. companies, primarily within the defense sector, adding to the approximately 60 American firms already facing penalties due to Trump's trade policies.

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The finance ministry of China criticized the U.S. for what it termed “a mistake on top of a mistake,” asserting that the escalating tariffs infringe upon China’s legitimate rights and undermine the multilateral trading system. "The U.S. escalation of tariffs on China is a serious infringement of China’s legitimate rights and interests," the ministry stated.

Trump's administration has targeted China with the highest tariffs, claiming that the country has engaged in unfair practices and trade barriers that disadvantage U.S. businesses. Earlier on Wednesday, China released a white paper on U.S.-China trade relations, suggesting that the trade imbalance is "inevitable" and primarily due to structural issues within the U.S. economy and the comparative advantages held by both nations.

According to U.S. Census data, China's trade surplus with the U.S. ballooned to $295.4 billion last year, up from $279.1 billion in 2023. This surplus peaked in 2018 at $418 billion, coinciding with the start of the tariffs imposed by Trump’s administration. 

While China committed to boosting U.S. imports as part of a "Phase 1" trade deal in 2020, it reportedly did not meet these targets, a situation exacerbated by the COVID-19 pandemic. The white paper claims China has "scrupulously fulfilled its obligations" and accuses the U.S. of reneging on the agreement.

The report further detailed how the U.S. has intensified economic pressures on China while promoting "false narratives" regarding human rights and the pandemic. Additionally, China emphasized its pursuit of expanding trade in services with the U.S., an area that has not been adequately addressed in the tariffs imposed by the Trump administration.

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As both nations brace for further economic fallout, China is exploring opportunities in other markets across Asia, Europe, and beyond. However, these alternatives are not expected to compensate for the substantial market that the U.S. represents.

Chinese officials reaffirmed their resolve to counter U.S. trade actions. A spokesperson from the commerce ministry stated that "If the U.S. insists on escalating trade restrictions, China has both the determination and the means to respond forcefully." They further insisted that there are "no winners in a trade war" and that China's government is committed to protecting the interests of its citizens.

Public sentiment in China is beginning to reflect growing concern over the economic implications of the trade conflict. “The situation has already reached a blatant financial and trade war on the global stage,” remarked 20-year-old Shanghai resident Ling Wanhua, highlighting anxieties about job prospects for young graduates amid an escalating economic war.

Amid these developments, reports indicate that China's top leadership is poised to convene a meeting to devise strategies to bolster the economy and stabilize capital markets, as the effects of the trade war continue to reverberate through both nations.