In a fierce retaliatory move in the US-China trade war, Beijing on Wednesday counterattacked President Donald Trump’s drastic 104% tariffs with its own massive increase, slapping an 84% tariff on all US imports higher than the previously announced 34%. The new tariff will take effect from April 10, said China’s Finance Ministry, according to Reuters.
In addition to the tariff increase, Beijing has blacklisted 12 US companies on its export control list and added six more to its “unreliable entities” list, further constricting trade. These actions were made just a few days after the White House announced that its record 104% tariff on Chinese imports would be levied beginning April 9.
The stock market responded quickly to the events, with US stock index futures falling as concerns of escalating economic tensions between the world’s two largest economies deepened.
Trump had first threatened that his government would not retreat unless China reacted to his retaliatory tariff threats. China, in turn, not only increased its import tariffs but also proceeded to limit the export of essential materials, including medium and heavy rare earths essential components in tech production, like semiconductors and electric vehicle batteries.
China’s Ministry of Commerce justified the moves as necessary to protecting national security and maintaining international commitments, such as non-proliferation treaties.
Reacting to Trump’s previous comments that “China cannot afford to do it,” the Chinese government replied with firm determination. “If the US continues to escalate its economic restrictions, China has the will and ability to resist to the end,” a ministry statement said.
Chinese Premier Li Qiang was in the same vein, saying that the country has strong policy instruments to help mitigate any economic impact and remains confident that China will continue growing through 2025.
The Xi government so far has not shown any signs of willingness to enter talks with Washington.
