The US imposed 104% tariffs on China after Trump missed the deadline.
The United States imposed a 104% tariff on Chinese imports after China failed to remove its retaliatory tariffs by a deadline set by President Donald Trump. The new tariff rate, which went into effect at 12:01 a.m. ET on Wednesday, April 9, 2025, is the result of an additional 50% increase on top of the 20% and 34% tariffs already in place. The tariff escalation between the two countries began when Trump announced a 10% baseline tariff on all goods imported into the U.S. effective April 2, 2025. This was followed by a 34% tariff on Chinese goods on April 7, 2025, and an additional 50% tariff on April 8, 2025. The White House justified the tariffs by accusing China of non-market policies and practices that gave Beijing "global dominance in key manufacturing industries" and "destroyed American industry". China responded by vowing to take "resolute and effective measures" to safeguard its rights and interests, stating that it would fight the trade war "to the end" and safeguard its sovereignty, security, and development interests. The Chinese government has not yet announced immediate retaliatory measures, but has signaled its determination to retaliate. The impact of the tariffs is significant for both countries and global markets. Apple, which does most of its manufacturing in China, will face a significant increase in costs due to the new tariffs. The company has secondary production in Vietnam, India, and other countries, which are facing new import duties. Additionally, the US stock market has been negatively impacted, with the S&P 500 closing below 5,000 for the first time in nearly a year. The index has fallen 18.9% from its most recent high on February 19, 2025, close to the 20% drop that defines a bear market. Global markets have also been affected, with Asian markets seeing considerable volatility. Japan's Nikkei 225 rebounded sharply after Trump and Japanese Prime Minister Shigeru Ishiba agreed to begin trade talks.
However, other markets, including China's Shanghai Composite and Hong Kong's Hang Seng Index, have been more volatile.
The US administration has said it believes China wants to make a deal and that the tariffs are bargaining chips to reach better international trade deals.
However, China has described the additional tariffs as "blackmail" and vowed to "fight to the end."
The situation remains tense, with both sides showing no signs of backing down.
The global economic impact of these tariffs is significant, with concerns of a potential recession and further market declines.
The US and China are the world's two largest economies, and their trade tensions could have far-reaching consequences on global trade and economic stability.
In short, the imposition of a 104% tariff on Chinese imports by the United States represents a major escalation in the ongoing trade tensions between the two countries. Both sides have taken tough stances, with China vowing to retaliate and the US administration using tariffs to negotiate better trade terms. The economic impact is significant, impacting global markets and potentially leading to further volatility and economic challenges.