Washington: U.S. President Donald Trump has announced a dramatic escalation in trade tensions with China, imposing a steep 125% tariff on Chinese imports, effective immediately. At the same time, Trump has temporarily eased recently imposed tariffs on imports from over 70 other countries, reducing them to 10% for the next 90 days.
In a post on his social media platform "Truth Social," Trump stated that more than 70 countries had contacted U.S. officials seeking to resolve trade disputes. While China faces a harsh new tariff regime, these other nations — previously labeled by Trump as “bad actors” — will now see significantly reduced tariff rates on goods exported to the United States.
Trump’s move comes shortly after China retaliated against earlier U.S. tariffs by raising its own import duties on American goods by 50%, bringing the total Chinese tariff burden on U.S. exports to 84%. Beijing condemned the Trump administration’s actions, accusing it of “economic coercion,” and vowed to respond decisively.
Chinese Foreign Ministry spokesperson Lin Jian told reporters Wednesday that if the U.S. insists on continuing a “trade war,” China is prepared to fight “to the very end.”
The trade war between the world’s two largest economies has raised alarms globally, with experts warning of potential ripple effects across international markets. Trump has also increased tariffs on the European Union, Vietnam, South Africa, and other countries, accusing them of unfair trade practices.
The president’s tariff policies have triggered backlash from several governments and rattled financial markets. Earlier this week, stock prices around the world plunged amid fears of higher consumer prices and a looming economic slowdown.
In the U.S., concerns over rising costs are mounting. However, following Trump’s announcement of a temporary tariff suspension for most countries, the S&P 500 — the benchmark index of major U.S. companies — rebounded sharply, surging by 7% just hours after the announcement.
Despite the market reaction, U.S. Treasury Secretary Scott Bassant emphasized that Trump's policy shift was not driven by stock market fluctuations. Meanwhile, Senate Democratic Leader Chuck Schumer criticized the move, claiming it signaled weakness and a political retreat.
The latest tariff adjustments come on the heels of an interest rate hike on U.S. government debt, with the rate reaching 4.5% — the highest since February. The economic and political consequences of Trump’s evolving trade strategy are likely to dominate headlines and policy debates in the coming weeks.
