China announced on Friday that it will hike tariffs on American goods from 84 per cent to 125 per cent, escalating an already intense trade war with the United States and stoking fears of broader economic fallout.
The move comes in direct response to U.S. President Donald Trump’s recent decision to raise tariffs on Chinese imports to a cumulative 145 per cent, even as he paused similar duties for other countries. Beijing’s retaliatory tariffs are set to take effect Saturday, marking another major clash in the ongoing economic standoff between the world’s two largest economies.
In a strongly worded statement, a spokesperson for China’s Finance Ministry called Washington’s repeated tariff increases “economic bullying,” warning that such actions “will become a joke in the history of the world economy.” The spokesperson added, “If the U.S. insists on continuing to substantially infringe on China’s interests, China will resolutely counter and fight to the end.”
China’s Commerce Ministry confirmed it would also file another formal complaint with the World Trade Organization (WTO), arguing the U.S. actions violate global trade rules.
The tit-for-tat tariff measures have rattled global markets, contributing to volatility in stock and bond markets, and raising concerns among economists that the U.S. may be edging toward a recession. Though there was brief relief earlier in the week when the U.S. paused tariffs for many countries, the rising tensions with China—its largest trading rival—continue to cloud the global economic outlook.
The head of the WTO, Ngozi Okonjo-Iweala, warned earlier this week that the trade war could “severely damage the global economic outlook.”
China’s new tariffs will hit key U.S. exports such as soybeans, aircraft and aircraft parts, and pharmaceuticals, adding to recent suspensions of sorghum, poultry, and bonemeal imports from American companies. China has also tightened export controls on rare earth minerals, which are essential for many high-tech industries.
Meanwhile, U.S. consumers and businesses may soon feel the pinch as tariffs on Chinese goods—including electronics, industrial machinery, toys, and household items—have soared to 145 per cent, potentially driving up prices.
Trump announced the new China tariffs on Wednesday, stopping short of imposing a 20 per cent duty on Chinese exports related to the country’s alleged role in fentanyl production. However, White House officials say the goal remains to boost domestic manufacturing and shift production back to the U.S.—a politically high-stakes gamble that may take years to yield results, if at all.
As both nations dig in, the trade battle shows no signs of slowing, with global markets bracing for more turbulence ahead.