Customs war escalated: China strikes with 34% tariffs on US goods!

Customs war escalated: China strikes with 34% tariffs on US goods!

Vienna, Österreich - The trade conflicts between the USA and China continue to escalate, which will lead to new tariffs and export controls. From April 10, 2025, China plans to collect tariffs of 34 percent on US goods. This measure takes place in response to the existing US tariffs, which has grown to a total of 54 percent since President Donald Trump took office after 20 percent were raised to China goods. Detals of 10 and 15 percent already introduced on US agricultural and energy products have heavily burdened bilateral trade. Trump described China's reaction as "panic" and sharply criticized the new measures. At the same time, he calls for negotiations with Vietnam and interest reductions by FED boss Jerome Powell, who are considered too early.

The escalation also leads to another step in China, since the state introduces export controls for seven rare earths. In another conflict step, China has placed eleven US companies on a black list, which significantly restricts trading traffic. These steps are followed by China's complaint at the World Trade Organization (WTO) against the US import tariffs, which are referred to as "harassment".

reactions to the trade conflicts

The current developments have already triggered massive reactions on the global financial markets, with the DAX and the ATX suffered significant price losses. In particular, the ATX recorded a decline of almost 10 percent in the weekly perspective. Powell continues to warn of increasing inflation and slower growth in the USA, which reinforces the concerns about economic prospects.

The tensions between the two largest economies in the world have their origins in disputes that began in March 2018. The aim of modifying the Chinese state capitalist economic and industrial policy and reducing the commercial balance deficit, which was $ 375 billion in 2017. Since then, the United States has proven imports from China worth around $ 370 billion with additional tariffs.

The complexity of trade relationships

Some of the measures resulted from the "Phase One Trade Agreement", which was signed on January 15, 2020. In this agreement, China undertook to buy US products worth $ 200 billion in two years. The aim was to improve the trade compensation, but reality shows a different direction. Critics describe the agreement as managed trade that could violate WTO principles. In addition, substantial conversations about a phase-twoal agreement have not yet been made.

US customs policy has proven to be disadvantageous to the US economy, especially for the processing business. The negative effects are also evident in US agriculture, which, despite the purchase obligations in the phase-one agreement, could not compensate for export losses. From a comprehensive perspective, the trade confrontation leads to mixed effects for third countries, whereby the possibilities of taking on the role of China or the USA are limited.