KEY POINTS
- China raises tariffs on US goods to 84%
- Beijing’s move follows US imposition of 104% duties on Chinese imports
- China’s finance ministry says US action “severely infringes” its rights
- Beijing vows to “fight to the end” against tariff escalation
- US stock futures fall over 1% amid rising trade tensions
- UK, France, and EU express concern over impact of US tariffs
BEIJING: China on Wednesday announced it will raise tariffs on US goods to 84 percent, up from 34 percent, in a swift retaliatory move after Washington hiked import duties on a wide range of Chinese products.
The announcement came just hours after US President Donald Trump’s latest round of tariffs came into force, which includes a 104 percent levy on select Chinese imports.
In response, China’s Ministry of Finance issued a statement declaring that the new tariff rate will take effect from 12:01 pm (local time) on Thursday.
“The tariff escalation against China by the United States simply piles mistakes on top of mistakes and severely infringes on China’s legitimate rights and interests,” the ministry said.
China warned that Washington’s actions are damaging to the multilateral, rules-based trade system.
In a policy paper released on Wednesday, China’s Ministry of Commerce said that Beijing has the “firm will and abundant means to take necessary countermeasures and fight to the end”.
“History and facts have proven that the United States’ increase in tariffs will not solve its own problems,” the document said.
“Instead, it will trigger sharp fluctuations in financial markets, push up US inflation pressure, weaken the US industrial base, and increase the risk of a US economic recession, which will ultimately only backfire on itself.”
The ministry further argued that the widely held belief of an unbalanced trade relationship is misplaced.
It noted that when accounting for services and income generated by American firms operating in China, the economic relationship between the two countries is “roughly balanced”.
As part of its response, China will also impose an additional 50 percent levy on all US goods, effectively bringing total duties to 84 percent.
Moreover, six US artificial intelligence firms, including Shield AI Inc. and Sierra Nevada Corporation, have been blacklisted for either selling arms to Taiwan or collaborating on military technology with the island.
An additional 12 US companies have been added to China’s export control list.
ALSO READ: Trump’s New 104pc Tariffs on Chinese Goods Take Effect
The tit-for-tat tariffs have rattled global markets. According to trading data, e-mini futures for major US indices – including the Dow Jones Industrial Average, S&P 500, and Nasdaq – dropped by more than 1 percent as of 11:21 GMT, reflecting investor unease over the deepening trade conflict.
US Treasury Secretary Scott Bessent responded to Beijing’s announcement by calling the move “unfortunate”, adding that China remains “the worst offender in the international trading system”.
In an interview with Fox Business, Bessent said that “everything is on the table”, including the potential delisting of Chinese firms from US stock exchanges.
Several countries have strongly reacted to Washington’s tariff hike. UK Chancellor of the Exchequer Rachel Reeves stressed the importance of avoiding tariff escalation, saying that London is currently negotiating a trade agreement with Washington that aligns with British interests.
France’s Industry Minister Marc Ferracci urged domestic firms to reconsider US investments, calling it a “complicated moment in time”.
Meanwhile, the European Central Bank’s Francois Villeroy said the ECB stands ready to support the eurozone economy amid potential financial instability.
China’s Foreign Ministry warned that the United States’ use of tariffs as a pressure tactic constitutes “classic unilateralism, protectionism, and economic bullying”.
Zhiwei Zhang, president and chief economist at Pinpoint Asset Management, said the escalation sends a clear signal of Beijing’s unyielding stance.
“I don’t expect a quick and easy way out from the current trade conflict,” Zhang warned. “The damage to both economies will become visible soon.”
