China Demands US To Lift Trade Tariffs | Economic Impact Explained

China has strongly urged the United States to immediately revoke its latest tariff measures while vowing retaliatory actions to protect its economic interests.

This statement follows sweeping trade levies imposed by former US President Donald Trump on global trading partners.

China’s Response to the US Tariff Hike

In an official statement, China’s Ministry of Commerce criticized the US for disregarding trade agreements established through years of negotiations. It also highlighted that the US economy has significantly benefited from global trade.

“China firmly opposes these measures and will implement countermeasures to defend its legitimate interests,” the ministry stated.

Breakdown of the US Tariff Increase

On Wednesday, Trump announced an additional 34% tariff on Chinese imports, adding to the 20% duty imposed earlier in the year. This brings the total tariff rate to 54%, approaching the 60% threshold he had previously suggested during his presidential campaign.

As a result, exporters from China and other global economies will now face a minimum 10% tariff, contributing to the newly introduced 34% levy. This change will take effect from Saturday, with higher reciprocal tariffs set to roll out by April 9.

De Minimis Loophole Closed

In addition to the tariff hike, Trump signed an executive order eliminating the “de minimis” rule. This exemption had allowed low-value shipments from China and Hong Kong to enter the US duty-free. The closure of this loophole is expected to impact cross-border e-commerce significantly.

Economic Implications and Global Trade Impact

The new tariffs could further escalate tensions between the two largest economies, potentially disrupting global supply chains and international trade relations. Analysts suggest that businesses dependent on imports from China may face rising costs, which could lead to increased consumer prices in the US.

For further insights on the economic impact of trade tariffs, read this comprehensive analysis by the World Trade Organization.