Beijing: A renewed wave of market downturn has been observed in China and Hong Kong following the U.S. government's imposition of a 104% tariff on certain Chinese products.
After several days of declines, Asian markets, including Shanghai, had shown signs of mild recovery on Tuesday. However, the announcement of the increased U.S. tariffs reversed that momentum on Wednesday. At the opening of trading, China’s Shanghai Composite Index dropped by 1.8%, while Hong Kong’s Hang Seng Index saw a sharper decline of 2.8%.
In response, China reaffirmed its intention to retaliate against the latest U.S. trade measures.
White House Press Secretary Karoline Leavitt confirmed on Tuesday that starting at 12:01 a.m., a 104% tax would be applied to select Chinese imports. This move comes as a consequence of China’s refusal to roll back its own retaliatory tariffs. Leavitt stated that President Trump believes China is open to negotiating a deal.
She added that approximately 70 countries have contacted the U.S. to discuss tariff-related negotiations and emphasized that strategies will be tailored based on individual national interests. Leavitt made it clear that there will be no delay or extension in the implementation of the tariffs.
Chiang Wang, Chief Economist for Asia-Pacific at Vanguard Investment Firm, warned that escalating trade tensions between the U.S. and China could severely impact Chinese exports. This, in turn, could damage local investment, the labor market, consumption, and investor confidence in China.
