US President Donald Trump is set to impose an astounding 104 per cent in levies across all Chinese imports on Wednesday local time (Thursday AEST), White House press secretary Karoline Leavitt announced.
This comes on top of Chinese tariffs that were in place prior to Trump’s second term.
China was already set to see tariffs increase by 34 per cent on Wednesday as part of Trump’s “reciprocal” tariffs package. But the president tacked on another 50 per cent after Beijing didn’t back off its promise to impose 34 per cent retaliatory tariffs on US goods by noon Tuesday, adding an additional 84 per cent in duties.
Earlier Tuesday, China’s Commerce Ministry said it “firmly opposes” the additional 50 per cent tariffs on Chinese imports, calling it “a mistake upon a mistake.” The ministry vowed to escalate its retaliation on US exports.
US stocks, which soared Tuesday morning, began moving lower off Leavitt’s comments. By 3pm ET (5am Wednesday AEST) the Dow, Nasdaq and S&P 500 were all in negative territory.
“Countries like China, who have chosen to retaliate and try to double down on their mistreatment of American workers, are making a mistake,” Leavitt told reporters on Tuesday.
“President Trump has a spine of steel, and he will not break.
“The Chinese want to make a deal, they just don’t know how to do it.”
She declined to share what, if any, terms Trump would consider to lower tariffs on China.
Trump initially imposed a 10 per cent tariff on all Chinese goods in February, with no exceptions, tying it to the country’s alleged role in aiding illegal immigration and getting fentanyl into the US. Last month, he doubled those rates.
China was America’s second largest source of imports last year, shipping a total of US$439 billion ($735.69 billion) worth of goods to the US, while the US exported US$144 billion ($241.32 billion) worth of goods to China. The mutual tariffs threaten to hurt domestic industries and are poised to result in layoffs.
When Trump’s first term ended, the US charged an average tariff rate of 19.3 per cent on Chinese goods, according to a Peterson Institute for International Economic analysis. The Biden administration kept most of Trump’s tariffs in place while also adding additional ones, bringing the average rate to 20.8 per cent.
Come Wednesday in the US, the total average tariff on Chinese exports to the US will soar to nearly 125 per cent.
While previous rounds of Chinese tariffs caused more American businesses to look to other foreign countries like Mexico and Vietnam to manufacture goods, China remained the top foreign source of several items.
That includes, among others, toys, communication equipment such as smartphones, computers and a wide range of other consumer electronics. All these goods are likely to cost US consumers substantially more soon.
The full list of Trump’s ‘reciprocal’ tariffs
Dozens of countries set to see higher tariffs soon, too
Dozens of other countries as well as the European Union also face a midnight deadline for new tariff rates. Those rates, which Trump laid out last week, range from 11 per cent to 50per cent.
Leavitt told reporters that despite several conversations with world leaders aiming to negotiate lower tariff rates, Trump has little appetite to delay his plans.
Having spoken with Trump earlier on Tuesday, Leavitt said, “He expects that these tariffs are going to go into effect.”
At the same time, she said Trump instructed his trade team to make “tailor-made” deals with countries that want to negotiate.
Pressed further on whether the president had any timeline or deadline for the trade deals, Leavitt again reiterated that they won’t be “off-the-rack deals.”
