China announced Friday it will raise tariffs on U.S. goods from 84% to 125% — the latest salvo in an escalating trade war between the world’s two largest economies that has rattled markets and raised fears of a global slowdown.
While President Donald Trump paused import taxes this week for other countries, he raised tariffs on China, and they now total 145%. China has denounced the policy as “economic bullying” and promised countermeasures. The new tariffs on U.S. goods begin Saturday.
Washington’s repeated jacking up of tariffs “will become a joke in the history of the world economy,” a Chinese Finance Ministry spokesman said in a statement announcing the new tariffs. “However, if the U.S. insists on continuing to substantially infringe on China’s interests, China will resolutely counter and fight to the end.”
China’s Commerce Ministry said it would file another lawsuit with the World Trade Organization against the U.S. tariffs.
Wall Street defied its futures Friday, opening in the red. The Dow Jones Industrial Average, S&P 500 and Nasdaq opened down 0.5% or worse amid the tariff tit-for-tat. Minutes later, stocks spiked back in the green.
The U.S. isn’t alone — global shares wobbled Friday after the latest escalation in the China-U.S. trade war, with Japan and some European markets slipping and others standing firm.
Deepening worries over Trump’s trade war caused Tokyo’s benchmark to initially fall more than 5%. It later regained some ground, closing 3% lower at 33,585.58.
Trump’s on-again, off-again measures have caused alarm in stock and bond markets and led some to warn the U.S. could be headed for a recession. There was some relief when Trump paused the tariffs for most countries — but concerns remain since the U.S. and China are the world’s No. 1 and No. 2 economies, respectively.
The trade war between the U.S. and China “could severely damage the global economic outlook,” the head of the WTO, Ngozi Okonjo-Iweala, said earlier this week.
Chinese tariffs will affect goods like soybeans, aircrafts and their parts, and drugs — all among the country’s major imports from the U.S. Beijing, meanwhile, suspended sorghum, poultry and bonemeal imports from some American companies last week and put more export controls on rare earth minerals, critical for various technologies.
The United States’ top imports from China, meanwhile, include electronics, like computers and cell phones, industrial equipment and toys — and consumers and businesses are likely to see prices rise on those products, with tariffs now at 145%.
Trump announced Wednesday that China would face 125% tariffs, but he did not include a 20% tariff on China tied to its role in fentanyl production.
White House officials hope the import taxes will create more manufacturing jobs by bringing production back to the U.S. — a politically risky trade-off that could take years to materialize, if at all.
-NewsNation
