BEIJING, China – China announced on Friday it will impose sweeping 34% tariffs on all imports from the United States starting April 10, in retaliation for President Donald Trump’s latest escalation of the global trade war.
The response comes just two days after Trump declared a national economic emergency and introduced an additional 34% tariff on all Chinese goods entering the United States — on top of earlier rounds of 10% tariffs imposed this year.
With pre-existing duties included, the effective rate on some Chinese goods is now estimated to exceed 54%.
In a statement issued on Friday, April 4, 2025, by the State Council Tariff Commission, Chinese officials condemned the U.S. measures, calling them a violation of global trade rules and “a typical unilateral bullying practice.”
“This practice of the U.S. is not in line with international trade rules, seriously undermines China’s legitimate rights and interests,” the commission said.
A Tense Turn in U.S.-China Relations
This latest tit-for-tat marks a sharp escalation between the world’s two largest economies, and could significantly reshape more than $500 billion in annual bilateral trade.
Analysts warn the confrontation now risks moving from a trade dispute to a long-term economic decoupling with deep global consequences.
As part of its retaliation, China also added 11 American firms — including several drone manufacturers — to its “unreliable entity list,” restricting their ability to conduct business in the country.
It also placed export controls on 16 U.S. companies and launched new anti-dumping investigations into U.S. and Indian exports of CT X-ray tubes.
In a further blow to U.S. technology and manufacturing sectors, Beijing imposed export restrictions on seven rare-earth minerals critical to high-tech production, including samarium, gadolinium, and terbium.
Markets in Turmoil
Financial markets reacted swiftly and sharply to the news. U.S. stock futures plummeted in early trading Friday.
The Dow Jones Industrial Average was set to open down more than 1,000 points, or 2.3%, while the S&P 500 and Nasdaq Composite faced similar losses.
European and U.K. indices also tumbled, on pace for their worst single-day declines since the COVID-19 pandemic.
Markets were already rattled by Trump’s earlier tariff announcement.
On Thursday, the Dow dropped over 1,600 points, the S&P 500 fell nearly 5%, and the Nasdaq plunged almost 6%, marking the worst trading day in roughly five years.
Rubio: “Markets Will Adjust”
Speaking from Brussels, U.S. Secretary of State Marco Rubio acknowledged the economic shock but downplayed long-term consequences.
“Yes, markets are crashing,” Rubio said.
“But businesses around the world, including in trade and global trade, they just need to know what the rules are. Once they know what the rules are, they will adjust to those rules.”
The Trump administration has framed the sweeping tariffs as necessary to protect American industry and curb illicit activities — including fentanyl trafficking — that it attributes in part to China.
Ripple Effects for Both Economies
For China, the timing is particularly challenging.
The economy has struggled to regain momentum post-pandemic, and officials have recently introduced stimulus measures to boost faltering domestic consumption.
The tariffs may now hinder those efforts further.
Larry Hu, chief China economist at Macquarie Group, estimated that the cumulative impact of Trump’s tariff policy has raised the average U.S. tariff rate on Chinese goods to 69%.
In a research note, Hu predicted the latest escalation could shave as much as 2.5 percentage points off China’s growth in 2025, where Beijing has targeted a 5% expansion rate.
“The impact could manifest itself through multiple channels such as falling U.S. demand for Chinese goods, the potential global economic slowdown and the hit on export re-routing,” Hu wrote.
Export re-routing — the redirection of goods through third countries to circumvent tariffs — was a tactic employed during Trump’s first term.
Southeast Asian and Latin American economies benefitted from the practice, but with tariffs now broadly applied across many countries, that option may prove less effective.
Looking Ahead
With China’s retaliation now in motion and negotiations stalled, both economies — and the global system — face a turbulent period ahead.
Analysts say the next few weeks will be crucial in determining whether the current standoff intensifies into a prolonged economic standoff or yields to fresh talks under newly drawn lines.
