On Wednesday, Trump unveiled an additional 34% tariff on all Chinese goods imported into the US, in a move poised to cause a major reset of relations and worsen trade tensions between the world’s two largest economies.
“This practice of the US is not in line with international trade rules, seriously undermines China’s legitimate rights and interests, and is a typical unilateral bullying practice,” China’s State Council Tariff Commission said in a statement announcing its retaliatory tariffs.
Since returning to power in January, Trump had already levied two tranches of 10% additional duties on all Chinese imports, which the White House said was necessary to stem the flow of illicit fentanyl from the country to the US. Combined with pre-existing tariffs, that means Chinese goods arriving in the US would be effectively subject to tariffs of well over 54%, CNN reported.
China’s retaliation against the latest round of US tariffs is more sweeping than its earlier reciprocal actions. Beijing had responded to previous levies swiftly but moderately, imposing retaliatory tariffs on targeted US imports, including agricultural products and fuel, while taking action against certain American firms and ramping up export controls.
The latest tariffs on Chinese goods are higher than what many analysts had expected and could fundamentally reshape relations, and roughly half a trillion dollars in trade, between the two economies after decades of interdependence.
As part of the retaliatory measures announced Friday, when hundreds of millions of people in China celebrated a major public holiday called the Tomb Sweeping Festival, the country also added 11 American companies to its “unreliable entity list,” including drone manufacturers, and put export controls on 16 American companies to prohibit the export of Chinese dual-use items.
In addition, Beijing also unveiled export controls on seven types of rare-earth minerals to the US, including samarium, gadolinium and terbium.