China Responds with 34% Tariffs on US Goods Amid Escalating Trade Tensions

In a sharp response to renewed US trade measures, China has announced a 34% tariff on all imports from the United States, effective April 10. The move marks a significant escalation in the ongoing trade dispute, which has intensified since former US President Donald Trump returned to office and reignited aggressive economic policies.

Earlier this week, Trump revealed a 34% tariff on all Chinese imports, a move that dramatically increased trade tensions between the two largest economies in the world. These new levies come in addition to two previous rounds of 10% tariffs introduced earlier this year, which the White House claimed were aimed at combating the influx of illegal fentanyl into the US. Altogether, Chinese goods are now subject to combined US duties exceeding 54%.

China’s latest retaliatory actions reflect a tougher stance than previous responses. Earlier countermeasures had focused on specific categories like agriculture and energy, but this new round applies broadly and includes additional steps targeting US businesses. Alongside the tariffs, China added 11 US firms to its “unreliable entity list” and placed export restrictions on 16 American companies, mainly those involved in dual-use technologies.

The Chinese Ministry of Commerce also announced fresh anti-dumping investigations into imported CT X-ray tubes from the US and India. Furthermore, export controls have been tightened on seven critical rare-earth elements—such as gadolinium, terbium, and samarium—that are key components in high-tech manufacturing.

According to analysts, this shift signals a bolder economic strategy by Beijing. Leah Fahy, an economist specializing in Chinese markets, remarked that the breadth and intensity of China’s retaliation suggest the country is confident in its ability to withstand the fallout. President Xi Jinping appears to be positioning the Chinese economy as resilient enough to endure increased pressure.

Market reactions were swift and negative. US stock indices fell sharply after China’s announcement. The Dow Jones Industrial Average dropped over 1,000 points, while the S&P 500 and Nasdaq saw declines exceeding 3%. European and British markets followed suit, closing the week with their steepest losses in years. The uncertainty surrounding trade policy has raised investor concerns about a potential global recession.

US Secretary of State Marco Rubio responded to the market turmoil by acknowledging the downturn but expressed optimism that markets would eventually stabilize once the new rules became clear. “Global business just needs clarity,” he said during a meeting in Brussels. “Once the rules are set, companies will adjust.”

Experts have warned that these high tariffs could shave several percentage points off China’s economic growth. Economist Larry Hu estimates that the average US tariff rate on Chinese goods has now risen to nearly 69%, up from 15% before Trump first took office. Hu suggests this escalation could reduce China’s GDP growth by up to 2.5% this year, as exports decline and the broader global economy cools.

To meet its goal of 5% growth in 2025, China will likely have to boost domestic demand and further adapt its export strategies, including redirecting goods to alternative markets. While the trade war has entered a more aggressive phase, both sides appear prepared to endure the economic costs in pursuit of broader geopolitical goals.