China’s Ministry of Commerce strongly condemned U.S. President Donald Trump’s latest tariff threat, stating that it “firmly opposes” the additional 10% duty hike on Chinese goods. The ministry warned of potential retaliation if necessary, making it clear that China would take “all necessary countermeasures to defend its legitimate rights and interests.”
“If the U.S. insists on its own way, China will take all necessary countermeasures to defend its legitimate rights and interests,” a Ministry of Commerce spokesperson stated, as translated by CNBC. The statement also urged Washington to “not repeat its own mistakes” and instead return to resolving conflicts through equal and fair negotiations.
The warning followed Trump’s Thursday announcement of new tariffs set to take effect on March 4, coinciding with the start of China’s annual parliamentary meetings. These new duties would be in addition to the 10% tariff hike imposed by Trump on February 4. According to the U.S. president, both rounds of tariffs are in response to China’s role in the fentanyl trade. The potent drug, with key precursors largely produced in China and Mexico, has led to tens of thousands of overdose deaths annually in the U.S.
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China warns of ‘all necessary countermeasures’ after Trump announces a 10% tariff hike on Chinese imports. The trade war just got another round of fuel
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China’s Possible Response and Economic Considerations
Experts predict that China’s immediate retaliation could involve increasing tariffs on select American imports, adding more U.S. companies to its unreliable entity list, and tightening export controls on critical minerals. Neil Thomas, a fellow on Chinese politics at the Asia Society, stated that while Beijing would respond, its retaliation would likely remain “measured.” He noted that Chinese President Xi Jinping has an incentive to maintain dialogue with Washington to avoid worsening China’s already struggling economic growth.
Despite ongoing economic struggles, China’s exports have remained a rare bright spot. Given that the U.S. is China’s largest trading partner on a single-country basis, Beijing may approach the situation cautiously. However, retaliation could be targeted at industries vital to Trump’s voter base. Alfredo Montufar-Helu, head of the China Center at The Conference Board, suggested that China might hold back on extreme measures in hopes of future negotiations to prevent further economic repercussions.
Earlier this month, after the first round of U.S. tariffs, China responded by raising duties on certain U.S. energy imports and adding two American companies to its unreliable entity list, restricting their operations within China. The country also tightened controls on the export of critical minerals essential for U.S. industries.
“The sharpest arrow that China has in its quiver would be to restrict U.S. access to critical minerals that can’t readily be sourced elsewhere,” said Stephen Olson, a senior fellow at the Institute of Southeast Asian Studies and former U.S. trade negotiator.
China Toughens Its Stance
The latest statement from China’s Ministry of Commerce struck a firmer tone than its previous responses to U.S. tariff actions. The ministry not only defended China’s efforts to combat illegal drug trafficking but also dismissed Trump’s accusations regarding fentanyl as “purely shifting the blame” without addressing the root of the U.S. drug crisis. The statement further criticized the new tariffs for “adding to the burdens on American businesses and consumers and disrupting the global supply chain.”
“The latest communique sends a clear message that the Chinese government is ready to respond in defense of national interests, and they won’t ‘bend the knee,’” said Montufar-Helu.
China’s Ministry of Foreign Affairs also ramped up its rhetoric, denouncing the U.S. for “pressuring, coercing and threatening” China with tariffs. Spokesperson Lin Jian warned that such tactics would ultimately backfire on Washington.
Trade policy expert Deborah Elms from the Hinrich Foundation suggested that Trump’s tariff escalation might force China to reconsider whether a deal with the U.S. is even possible in the near term. She explained that Beijing now faces two choices: continue with moderate retaliatory measures in hopes of de-escalation or take more drastic action to demonstrate that the previous countermeasures were not taken seriously enough.
More Tariffs Likely on the Horizon
At the start of his second term, Trump directed his administration to reassess Beijing’s compliance with the 2020 trade agreement signed during his first presidency. The results of this investigation are expected to be delivered by April 1, potentially paving the way for even higher tariffs. Trump has indicated that his administration could introduce what he calls “reciprocal tariffs,” which would match the existing levies imposed by foreign nations, including China, on U.S. imports.
In a social media post on Thursday, Trump reaffirmed that “The April Second Reciprocal Tariff date will remain in full force and effect,” signaling that further trade tensions with China are almost inevitable.
The Escalating Trade Battle
With Trump doubling down on tariffs and China vowing to respond, the trade dispute between the two largest economies in the world is set to intensify. While Beijing may prefer a path that allows room for negotiation, the rising pressure could force China into stronger retaliatory actions. Whether both nations can find common ground or whether the dispute will spiral into a more aggressive trade war remains to be seen.
