On April 9, 2025, the White House confirmed that a 104% tariff on imports from China has gone into effect. This move follows President Donald Trump’s threat to impose additional tariffs if China did not withdraw its own retaliatory 34% tariffs on American goods by April 8. The US claims these tariffs are part of its efforts to address what it perceives as unfair trade practices by China. However, China has accused the US of engaging in “bullying practices” and has vowed to “fight to the end” if the US continues to escalate the trade war.
China’s exports to the US make up only 2% of its total economic activity, according to reports by Stephen McDonell. This relatively small proportion suggests that China may be able to withstand the economic pressure from the tariffs. In 2024, China’s exports to the US reached $72.52 billion in the first two months, up 8.1 percent year-on-year. Despite the tariffs, China’s economic resilience and diversified export markets mean it may not be severely impacted in the short term.
The imposition of these tariffs has had significant ripple effects across global markets. US stock markets closed lower on April 8, with the Dow Jones Industrial Average falling 0.84%, the S&P 500 dropping 1.57%, and the Nasdaq Composite shedding 2.15%. The CBOE Volatility Index, often referred to as the “fear index,” surged 11.39%. These market reactions highlight the uncertainty and potential economic disruption caused by the escalating trade tensions.
The tariffs are expected to increase prices for a wide range of consumer and industrial products in the US. China is a major supplier of consumer electronics, household goods, medical supplies, and food products to the US. With the new tariffs, these products are likely to become more expensive for American consumers. Additionally, retaliatory tariffs imposed by China on US exports, including soybeans, pork, and dairy, could harm American farmers and affect the broader agricultural economy.
The situation has also led to a broader reevaluation of global trade relations. Trump has imposed tariffs on imports from about 90 nations, describing these as “reciprocal” tariffs aimed at erasing trade imbalances. This move has prompted calls for negotiations from impacted countries, while experts warn that such tariffs could lead to a global recession. The future of global economic cooperation and the potential for further escalation remain uncertain as nations grapple with these new trade barriers.
