WASHINGTON, USA — The United States has officially begun imposing tariffs on Chinese imports, as President Donald Trump’s trade policy shifts into full effect.
The move has triggered immediate retaliation from Beijing, escalating tensions between the world’s two largest economies.
The tariffs—a 10% levy on Chinese goods—went into effect at 12:01 a.m. Eastern Time on Thursday.
In response, China announced a series of countermeasures, including tariffs of up to 15% on U.S. coal, liquefied natural gas (LNG), and automobiles, set to take effect next Monday.
The economic manoeuvring follows a tumultuous few days in which Trump agreed to temporary pauses on tariffs against Mexico and Canada after last-minute negotiations with Mexican President Claudia Sheinbaum and Canadian Prime Minister Justin Trudeau.
China Responds With Retaliatory Measures
China’s Commerce Ministry issued a strongly worded statement, accusing the Trump administration of violating international trade laws and announcing a formal complaint with the World Trade Organization (WTO).
“The United States’ unilateral decision to impose tariffs disrupts global trade stability,” the ministry said.
“China has no choice but to take necessary countermeasures to protect its interests.”
Beijing’s new tariffs, set to take effect on Monday, target key American exports, including:
- 15% tariff on U.S. coal and liquefied natural gas (LNG)
- Higher import taxes on American-made automobiles
- Additional restrictions on select U.S. agricultural goods
China also announced a new blacklist of American companies, adding brands such as Calvin Klein and Levi’s, signaling a potential shift away from U.S. consumer goods in retaliation for Trump’s trade policies.
Trump Defends Tariffs, Eyes TikTok and a Sovereign Wealth Fund
Speaking from the White House, Trump defended the tariffs as necessary to counter China’s “unfair trade practices” and protect American jobs.
He also signed an executive order to explore the creation of a U.S. sovereign wealth fund, which he suggested could be partially funded using revenue from tariffs.
“The money we collect from China should go toward strengthening our economy, investing in American industry, and protecting our financial future,” Trump said.
Additionally, Trump hinted at renewed action against TikTok, the Chinese-owned social media app, saying his administration “may use tariff money to buy TikTok and place it under U.S. ownership.”
The move would rekindle national security debates that began during his first term when the government attempted to force TikTok to divest from its Chinese parent company, ByteDance.
Mexico and Canada Avoid Immediate Tariffs – For Now
The 10% tariff on China comes just days after Trump had threatened to impose even steeper tariffs—25%—on all imports from Mexico and Canada as part of his broader strategy to curb migration and drug trafficking.
However, last-minute diplomatic efforts secured temporary exemptions for both countries:
- Mexico: Following a phone call between Trump and President Claudia Sheinbaum, the U.S. agreed to pause tariffs for one month in exchange for Mexico deploying 10,000 troops to the border and committing to crack down on fentanyl production.
- Canada: A similar 30-day delay was granted to Prime Minister Justin Trudeau after he agreed to strengthen security measures and form a joint U.S.-Canada task force to combat organized crime, money laundering, and drug trafficking.
Despite the temporary reprieve, Trump warned that tariffs could still be imposed if both governments fail to meet their commitments.
“I’m watching very closely. If they don’t deliver, the tariffs go back on. Simple as that,” he said.
Stock Markets React Amid Uncertainty
The announcement of tariffs on China—and the uncertainty surrounding North American trade—rattled global financial markets.
- The Dow Jones Industrial Average dropped nearly 600 points Monday morning before rebounding on news of the tariff pauses for Mexico and Canada.
- The Shanghai Composite Index fell 2.5%, reflecting investor concerns over the impact of U.S.-China trade tensions on global supply chains.
- Oil prices fluctuated, with Brent crude hovering around $82 per barrel, as markets weighed the potential impact on energy exports.
What’s Next? More Trade Talks or More Tariffs?
With China set to retaliate Monday, and with temporary pauses on tariffs for Mexico and Canada, the coming weeks will be pivotal for U.S. trade relations.
- U.S. and Chinese officials are expected to engage in negotiations in an attempt to prevent an escalating trade war.
- Talks between U.S., Mexico, and Canada are ongoing, with Trump’s administration evaluating progress before deciding whether to reimpose tariffs after the temporary pauses expire.
- Further action against TikTok remains a possibility, with Trump signaling renewed interest in forcing its sale to a U.S. company.
As the situation develops, the world watches to see whether Trump’s aggressive trade policies will reshape international commerce—or ignite a new wave of economic instability.
