The United States has announced tariffs of up to 245 per cent on Chinese imports, citing retaliatory actions by Beijing as the reason for the steep hike. The White House confirmed the development on Tuesday, further intensifying the ongoing trade war between the two economic giants.
The move comes as President Donald Trump approved a new investigation into potential national security risks associated with the US’ dependence on foreign imports of critical minerals, such as cobalt, lithium, nickel, and rare-earth elements. These materials are crucial for producing smartphones, electric vehicle batteries, and military equipment. The White House warned that over-reliance on foreign sources could lead to “serious, sustained, and long-term supply chain shocks,” jeopardizing national security and economic growth.
Previously, the tit-for-tat tariff dispute had resulted in the US imposing a 145 per cent duty on Chinese goods, while China had levied a 125 per cent tariff on American exports. In addition to the tariffs, Beijing had also restricted the export of certain high-tech materials vital for aerospace and defense industries.
Despite mounting trade tensions, China reported better-than-expected economic growth, with GDP expanding 5.4 per cent in the first quarter. Industrial production rose 6.5 per cent and retail sales jumped 4.6 per cent year-on-year. However, Chinese officials acknowledged that global economic conditions were becoming increasingly challenging and stressed the need for further steps to boost domestic growth and consumption.
Meanwhile, President Trump maintained that the onus is on China to move negotiations forward. “The ball is in China’s court. China needs to make a deal with us. We don’t have to make a deal with them,” he said, reiterating his stance a day after accusing Beijing of walking back on a major Boeing deal.
Throughout his term, Trump has frequently criticized China, India, Brazil, and other nations for imposing higher import tariffs on US goods than the US places on theirs. He has argued that reciprocal tariffs would either compel these countries to reduce their duties or revitalize American manufacturing, ultimately generating more local jobs.
Since the beginning of the year, the US administration has rolled out a series of tariffs targeting Chinese imports. A 10 per cent baseline tariff was introduced in February and March, followed by a 34 per cent hike in April. By April 9, cumulative tariffs had crossed the 100 per cent mark, triggering panic across global markets.
Although the US has temporarily halted some tariff orders, the measures affecting Chinese goods remain intact. In response, China has implemented its own countermeasures, including suspending imports of sorghum, poultry, and bonemeal, restricting 27 American companies, and lodging a complaint with the World Trade Organization.
Beijing has also sought to strengthen diplomatic ties with other major economies. In a recent statement, Chinese Foreign Minister Wang Yi called on India and China to collaborate, urging both nations to “make elephant and dragon dance” and “take the lead in opposing hegemonism and power politics”.