Donald Trump fulfilled his threat and added another chapter to the trade war against China. The White House confirmed that the President of the United States has ordered an unprecedented increase in tariff on Chinese imports, raising them to 104%. The measure, set to take effect on April 9, is a direct response to Beijing’s retaliations, which include their own 34% tariffs on U.S. goods.
The announcement was made through Fox Business, citing White House spokesperson Karoline Leavitt. The new tariff hikes on China would take effect one minute after midnight today, reported journalist Edward Lawrence. The decision responds to what Trump considers a stalling strategy by the Chinese government to avoid sitting at the negotiation table.
Why did Donald Trump impose a 104% tariff on China?
The escalation began when Donald Trump warned that if China didn’t withdraw its 34% tariffs before noon this Tuesday (Eastern Time, U.S.), the United States would impose a new round of additional tariffs of 50%, bringing the total to 104% on certain products.
According to Trump, China and other countries like South Korea “desperately want a deal,” but “don’t know how to start.” The former president even said he was expecting a call from Xi Jinping. “It will happen!” he wrote on his Truth Social network, although as of the time of publication, no direct contact with the Chinese president had been confirmed.
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How has China responded to Donald Trump’s tariffs?
Following the imposition of tariffs on Liberation Day, China’s response was swift. The Beijing government labeled the U.S. decision as “blackmail in nature” and expressed its “strong condemnation” in an official statement. China had already rolled out a set of countermeasures last Friday, which include:
- 34% tariffs on U.S. products.
- Economic sanctions on specific U.S. companies.
- Export restrictions on rare earth elements.
- Suspension of imports such as chicken and sorghum from American firms.
- Antitrust and anti-dumping investigations into U.S. products.
In addition, the Chinese government has filed a formal complaint with the World Trade Organization (WTO), arguing that Trump’s tariffs violate international trade rules.
What are the implications of this 104% tariff for the global economy?
The 104% tariff hike doesn’t only impact China—it has the potential to disrupt international trade on a large scale. Many U.S. companies that depend on Chinese supply chains could face steep increases in import costs, potentially leading to higher prices for consumers.
On the other hand, Trump also imposed global tariffs of 10% starting April 2, which came into effect last Saturday. Even higher rates are expected to be applied soon to products from the European Union, opening a new front in the trade conflict.
Although China has tools to respond—such as foreign reserves, influence in emerging markets, and diversified exports—a prolonged trade war with the U.S. adds uncertainty to its economy, especially as it seeks to revive growth after years of slowdowns and strict health measures.
What is a tariff?
A tariff is a tax applied to imported goods when they enter a country. This tax raises the price of foreign products, encouraging consumption of domestic goods and protecting local industries from foreign competition. However, this policy comes at a cost: consumers pay more, and industries that rely on imported inputs face higher production costs.
Why can tariffs trigger inflation?
When tariffs are imposed on imported goods, the direct consequence is higher prices.
If companies cannot find cheaper or nearby alternatives (nearshoring) or decide that reshoring is not viable in the short term, the cost falls on the end customer. And inflation—a problem that directly affects purchasing power—can erode the popularity of the administration enforcing such measures.
