US President Donald Trump has announced a dramatic increase in tariffs on all Chinese imports, set to reach 104% starting Wednesday (local time), as confirmed by White House Press Secretary Karoline Leavitt. This escalation follows existing tariffs and is part of Trump’s broader “reciprocal” tariffs policy. Initially, tariffs on China were due to rise by 34% the same day; however, Trump decided to impose an additional 50% after China maintained its stance on imposing 34% retaliatory tariffs on US goods.
China’s Ministry of Commerce responded, denouncing the additional tariffs as “a mistake upon a mistake” and promising to intensify retaliatory measures against US exports. The news of the increased tariffs caused US stock markets to decline after experiencing an initial rise.
Leavitt indicated that Trump remains steadfast in his approach, asserting that countries like China, which retaliate against US tariffs, are miscalculating their positioning. She also highlighted Trump’s commitment to a tough stance, mentioning that he would not relent in negotiations with China, who reportedly are keen to find a resolution but are uncertain about how to proceed.
Emerging from prior tariffs set at 10% in February, Trump’s measures were tethered to China’s alleged complicity in illegal immigration and drug trafficking. Recent tariffs have now escalated significantly, threatening various US industries dependent on imports. In 2022, China was a substantial source of US imports, sending products valued at approximately AUD 735 billion, while exports to China were valued at AUD 241 billion. The mutual tariffs raise concerns over potential job losses and economic impacts within the US.
Currently, the average tariff on Chinese exports is poised to climb to nearly 125%, increasing the financial burden on US consumers for a range of products, including consumer electronics and toys.
In addition to Chinese tariffs, several other nations, including EU countries, are facing impending tariff increases. Leavitt noted that while negotiations are underway, Trump is unwilling to postpone the tariff implementation. He anticipates these tariffs will take effect as planned, although he has instructed his trade team to explore tailored agreements with nations willing to negotiate.
Overall, this series of tariff increases signifies a continuation of Trump’s hardline trade policy, potentially impacting the broader economic landscape as producers and consumers adjust to the new financial realities.