The trade tensions between the world’s two largest economies are flaring once again, as China vowed on Wednesday to “fight to the end” in its intensifying standoff with the United States. The bold declaration came as Beijing announced it would raise tariffs on U.S. goods to a sweeping 84%, starting Thursday, in retaliation for a sharp escalation by Washington.
Just days earlier, U.S. President Donald Trump raised total tariffs on Chinese imports to 104%, calling the move part of his new “Liberation Day” policy aimed at reshaping global trade relations. In response, China announced a 34% blanket tariff on American goods, export controls on rare earth minerals, and a suite of other retaliatory measures.
“If the U.S. insists on further escalating its economic and trade restrictions, China has the firm will and abundant means to take necessary countermeasures and fight to the end,” read a pointed statement from China’s Ministry of Commerce, issued alongside a white paper on U.S.-China trade relations.
While many countries have recently sought to reengage with the U.S. on trade, China gave no indication it would return to the negotiating table soon. Speaking at a press briefing, Foreign Ministry spokesperson Lin Jian said, “If the U.S. truly wants to resolve issues through dialogue and negotiation, it should adopt an attitude of equality, respect and mutual benefit.”
Trade Deal Promises in Question
China’s white paper also accused the United States of breaching commitments made during the Phase 1 trade deal signed during Trump’s first term. Specifically, it cited new U.S. legislation targeting Chinese tech companies like TikTok, which would be banned unless sold to American ownership. China argues that this law violates an earlier promise that neither side would pressure the other into forced technology transfers.
Although President Trump granted TikTok a 75-day extension last week after a potential acquisition deal collapsed, sources say ByteDance, TikTok’s parent company, informed the White House that China will no longer approve any deal without broader talks on trade and tariffs.
Disputed Trade Balance
China’s paper also disputes the long-standing U.S. claim of a massive trade imbalance. While the U.S. typically points to its goods deficit, which stands in the hundreds of billions, China emphasized its $26.57 billion deficit in trade in services with the U.S. in 2023 — including sectors like banking, insurance, and accounting.
“When considering total economic exchange — goods, services, and local operations of U.S. firms in China — the relationship is roughly balanced,” the white paper asserts.
Ripple Effects Loom
In a sharply worded rebuke, China’s commerce ministry warned that U.S. tariffs could have unintended domestic consequences. “History and facts have proven that the United States’ increase in tariffs will not solve its own problems,” the statement read. “Instead, it will trigger sharp fluctuations in financial markets, push up U.S. inflation pressure, weaken the U.S. industrial base, and increase the risk of a U.S. economic recession, which will ultimately only backfire on itself.”
As the world watches the escalation with growing concern, emerging markets — particularly in Africa — are bracing for potential aftershocks. With global supply chains already under stress and the cost of key commodities like rare earths in flux, the U.S.-China rift may ripple far beyond their borders.
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