The trade war between the US and China (updated April 2025):

 

What is a Trade War, and why does it happen? A trade war is an economic dispute between two countries. It can occur when one country retaliates against another's perceived unfair trading practices with restrictions, such as tariffs, on imports. Domestic trade unions or industry lobbyists can pressure politicians to make imported goods less attractive to consumers, pushing international policy toward a trade war. Also, trade wars are often a result of a misunderstanding of the widespread benefits of free trade. Trade wars are usually considered a side effect of protectionism. Protectionism refers to government actions and policies that restrict international trade. A country will generally undertake protectionist actions to shield domestic businesses and jobs from foreign competition. Protectionism is also a method used to balance trade deficits.

Effects of a trade war: In an era of global trade, a trade war can become very damaging to the consumers and businesses of both nations, and the contagion can grow to affect many aspects of both economies. A trade war that begins in one sector can grow to affect other sectors. Likewise, a trade war that begins between two countries can affect other countries not initially involved in the trade war.

Trade War vs. Other Protectionist Actions: A trade war is distinct from other actions taken to control imports and exports, such as sanctions. The trade war has detrimental effects on the trading relationship between the two countries because its goals are explicitly related to trade. Sanctions may have philanthropic goals. Other non-tariff protectionist policies can be implemented by placing a cap on import quotas, setting clear product standards, or implementing government subsidies for processes to deter outsourcing.

Advantages and Disadvantages of a Trade War: Advantages (Pros): Proponents of protectionism argue that well-crafted policies provide competitive advantages and protect domestic companies from unfair competition. By blocking or discouraging imports, protective policies throw more business toward the domestic producers, which ultimately creates more employment. These policies can also serve to overcome a trade deficit. Additionally, proponents believe that painful tariffs and trade wars may be the only effective way to deal with a nation that continues unfair or unethical trading policies. Disadvantages (Cons): Critics argue that protectionism often hurts the people it is intended to protect by choking off markets and discouraging trade. It also slows down economic growth and hurts diplomatic relations and cultural exchange. Consumers may begin to have fewer choices in the marketplace. They may even face shortages if there is no ready domestic substitute for the imported goods that tariffs have impacted or eliminated. Having to pay more for raw materials hurts manufacturers' profit margins. As a result, trade wars can lead to price increases, with manufactured goods, in particular, becoming more expensive. This can then spark inflation in the local economy, overall.

History of Trade Wars: Trade wars are not an invention of modern society. Such battles have been going on for as long as nations have conducted trade with one another. For example, colonial powers fought each other over the right to trade exclusively with overseas colonies in the 17th century.

British versus Chinese trade war: The British Empire has a long history of such trade battles. One example is the opium wars of the 19th century with China. The British had been sending India-produced opium into China for years when the Chinese emperor decreed it to be illegal. Attempts to settle the conflict failed, and the emperor eventually sent troops to confiscate the drugs. However, the might of the British navy prevailed, and China conceded to the entry of additional foreign trade into the nation.

U.S. versus Europe trade war: In 1930, the United States enacted the Smoot-Hawley Tariff Act, raising tariffs to protect American farmers from European agricultural products. This act increased already hefty import duties to almost 40%. In response, several nations retaliated against the U.S. by imposing their own higher tariffs, and global trade declined worldwide. As America entered the Great Depression, which was aided greatly by disastrous trade policies, President Roosevelt began to pass several acts to reduce trade barriers, including the Reciprocal Trade Agreements Act.

U.S.-China and Others: Beginning in January 2018, President Trump imposed a series of tariffs on everything from steel and aluminum to solar panels and washing machines. Some of the effects impacted goods from the European Union (EU) and Canada, as well as China and Mexico. Canada retaliated by imposing a series of temporary duties on American steel and other products. The EU also imposed tariffs on American agricultural imports and other products, including Harley-Davidson motorcycles. By May 2019, tariffs on Chinese imports impacted nearly $200 billion of imports. As with all trade wars, China retaliated and imposed stiff duties on American imports. A study by the International Monetary Fund (IMF) found that U.S. importers of goods primarily shouldered the cost of the tariffs on Chinese goods. These costs were eventually passed on to the American consumer in the form of higher prices, which was not what the trade war was intended to accomplish.

USA versus Russia trade war : Although the U.S. and Russia were not engaged in a trade war, President Joe Biden announced sanctions against Russia on Feb. 22, 2022, in response to Russia's military aggression against Ukraine. The sanctions included blocking the funds of two Russian banks that financed the military, market restrictions on Russian sovereign debt, and the targeting of individual Russian elites.

The US-China trade war: (History and updates)

Year 2016: The concept of Information Technology Application Innovation (ITAI) began to take shape, with the Chinese government emphasizing the need for independent innovation in information technology. While running for President in 2016, Donald Trump expressed his disdain for many current trade agreements, promising to bring manufacturing jobs back to the U.S. from other nations where they had been outsourced, such as China and India.

January 2018: Trump announced 20% to 50% tariffs on solar panels and washing machines. About 8% of American solar panel imports in 2017 came from China. Imports of residential washing machines from China totaled about $1.1 billion in 2015.

February 2018: US Section 201 - Tariffs imposed on solar panels and washing machines.

March  2018: Trump announced tariffs of 25% on steel and 10% on aluminum imports from all countries,  temporarily exempting Argentina, Australia, Brazil, the EU, Canada, Mexico, and South Korea. The United States had imported about 3% of its steel from China. The announcement drew criticism from The Wall Street Journal's editorial board, which called the executive order "the biggest policy blunder of his Presidency." Trump asked the United States Trade Representative (USTR) to investigate applying tariffs on US$50–60 billion of Chinese goods. He relied on Section 301 of the Trade Act of 1974 for doing so, stating that the proposed tariffs were "a response to the unfair trade practices of China over the years", including theft of U.S. intellectual property. Over 1,300 categories of Chinese imports were listed for tariffs, including aircraft parts, batteries, flat-panel televisions, medical devices, satellites, and various weapons.

April 2018: The Ministry of Commerce of China responded by imposing tariffs on 128 products it imports from America. These included a 25% tariff on aluminum, airplanes, cars, pork, and soybeans, and a 15% tariff on fruit, nuts, and steel piping. U.S. Commerce Secretary Wilbur Ross said that the planned Chinese tariffs only reflected 0.3% of the U.S. gross domestic product. Press Secretary Sarah Huckabee Sanders stated that the moves would have "short-term pain" but bring "long-term success". The U.S. Trade Representative's office published an initial list of 1,300+ Chinese goods to impose levies upon, including products like flat-screen televisions, weapons, satellites, medical devices, aircraft parts, and batteries. Chinese Ambassador Cui Tiankai responded by warning the U.S. that they may fight back, saying, "We have done the utmost to avoid this kind of situation, but if the other side makes the wrong choice, then we have no alternative but to fight back." China's Customs Tariff Commission of the State Council decided to announce a plan of additional tariffs of 25% on 106 items of products, including automobiles, airplanes, and soybeans. Soybeans are the top U.S. agricultural export to China. Trump said that he was considering another round of tariffs on an additional $100 billion of Chinese imports as Beijing retaliates. The next day, the World Trade Organization received a request from China for consultations on new U.S. tariffs.

May 2018: China's MFN tariff cut on pharmaceuticals. China canceled soybean orders exported from the United States to China. Zhang Xiaoping, Chinese director for the U.S. Soybean Export Council, said Chinese buyers simply stopped buying from the U.S. Vice Premier and CCP Politburo member Liu He, top economic adviser to the President of China and CCP General Secretary Xi Jinping, visited Washington for further trade talks. Chinese officials agreed to "substantially reduce" America's trade deficit with China by committing to "significantly increase" its purchases of American goods. As a result, Treasury Secretary Steven Mnuchin announced, "We are putting the trade war on hold".  White House National Trade Council director Peter Navarro said there was no "trade war", but rather a "trade dispute, fair and simple. We lost the trade war long ago. Trump tweeted that "China has agreed to buy massive amounts of Additional Farm/Agricultural Products," although he later clarified the purchases were contingent upon the closure of a "potential deal." The White House announced that it would impose a 25% tariff on $50 billion of Chinese goods with "industrially significant technology;" the full list of products affected is to be announced by June 15. It also planned to impose investment restrictions and enhanced export controls on certain Chinese individuals and organizations to prevent them from acquiring U.S. technology. China said it would discontinue trade talks with Washington if it imposed trade sanctions.

June 2018: Trump declared that the United States would impose a 25% tariff on $50 billion of Chinese exports. $34 billion would start on July 6, 2018, with a further $16 billion to begin at a later date. China's Commerce Ministry accused the United States of launching a trade war and said China would respond in kind with similar tariffs for US imports, starting on July 6. Three days later, the White House declared that the United States would impose an additional 10% tariff on another $200 billion worth of Chinese imports if China retaliated against these U.S. tariffs. The list of products included in this round of tariffs was released on July 11, 2018, and was set to be implemented within 60 days. China retaliated, threatening its tariffs on $50 billion of U.S. goods and stating that the United States had launched a trade war. Import and export markets in several nations feared the tariffs would disrupt supply chains, which could "ripple around the globe”.

July 2018: China's MFN tariff cut on consumer goods, autos, and ITA products. American tariffs on $34 billion of Chinese goods came into effect. China imposed retaliatory tariffs on US goods of a similar value. The tariffs accounted for 0.1% of the global gross domestic product. On July 10, 2018, the U.S. released an initial list of the additional $200 billion of Chinese goods that would be subject to a 10% tariff. Two days later, China vowed to retaliate with additional tariffs on American goods worth $60 billion annually.

August 2018: The Office of the United States Trade Representative published its finalized list of 279 Chinese goods, worth $16 billion, to be subject to a 25% tariff from August 23. In response, China imposed 25% tariffs on $16 billion of imports from the US, which was implemented in parallel with the US tariffs on August 23. China filed a complaint with the World Trade Organization (WTO), stating that US tariffs on foreign solar panels clash with WTO rulings and have destabilized the international market for solar PV products. China stated that the resulting impact directly harmed China's legitimate trade interests. Peng Peng, a researcher with the China Renewable Energy Industry Association, said that the solar problem has existed for years and thought that China chose to bring it up to keep up the rhythm of the trade dispute. US treasury undersecretary David Malpass and Chinese commerce vice-minister Wang Shouwen met in Washington, D.C. in a bid to reopen negotiations. Meanwhile, on August 23, 2018, the US and China's promised tariffs on $16 billion of goods took effect, and on August 27, 2018, China filed a new WTO complaint against the US regarding the additional tariffs.

September 2018: The US announced its 10% tariff on $200 billion worth of Chinese goods would begin on September 24, 2018, increasing to 25% by the end of the year. They also threatened tariffs on an additional $267 billion worth of imports if China retaliated, which China promptly did on September 18 with 10% tariffs on $60 billion of US imports. So far, China has either imposed or proposed tariffs on $110 billion of U.S. goods, representing most of its imports of American products.

November 2018: China's MFN tariff cut on industrial goods. White House National Trade Council director Peter Navarro alleged that a group of Wall Street billionaires is conducting an influence operation on behalf of the Chinese government by weakening the president and the U.S. negotiating position, and urged them to invest in the Rust Belt. President Trump signed the revised U.S.–Mexico–Canada Agreement in Buenos Aires, Argentina. The USMCA contains a "rules of origin" provision for automobiles that was "touted by the Trump administration as a tool to keep out Chinese inputs and encourage production and investment in the US and North America."

December 2018: The planned increases in tariffs were postponed. The White House stated that both parties will "immediately begin negotiations on structural changes concerning forced technology transfer, intellectual property protection, non-tariff barriers, cyber intrusions, and cyber theft." According to the Trump administration, "If at the end of the 90-day limit, the parties are unable to reach an agreement, the 10 percent tariffs will be raised to 25 percent." The U.S. Trade Representative's office confirmed the hard deadline for China's structural changes is March 1, 2019. New York Fed president John Williams said that he believed the US economy would stay strong in 2019. Williams expects that increases in interest rates will be necessary to maintain the economy. He stated, "Given this outlook of strong growth, strong labor market, and inflation near our goal and taking account of all the various risks around the outlook, I do expect further gradual increases in interest rates will best sponsor a sustained economic expansion." Trump announced China was buying a "tremendous amount" of U.S. soybeans. Commodities traders saw no evidence of such purchases, and over the next six months, soybean exports to China were about one-quarter of what they were in 2017 before the trade conflict began. China reportedly considered purchases of American farm goods contingent upon closing a comprehensive trade deal. This year, the rising trade tensions and technological restrictions from the United States highlighted China's reliance on foreign technologies. Increased emphasis was put on ITAI, and the term "Xinchuang" (信创) started appearing more frequently in official documents, signaling a shift towards promoting domestic IT solutions.

Year 2019:

January 2019: China suspends retaliation against US autos and parts (Section 301) and reduces MFN tariff rates for 2019. An article in The Wall Street Journal reports that China's 2018 trade surplus with the United States was a record $323.32 billion despite Trump's tariffs.

February 2019: US Section 201 - Tariffs reduced on solar panels and washing machines in the second year of the policy.

March 2019: The U.S. Department of Commerce stated that in 2018, the U.S.'s overall trade deficit reached $621 billion, the highest it had been since 2008. Macron and Xi signed 15 trade deals totaling 40 billion euros, including a €30 billion Airbus aircraft purchase, French chicken exports, a French-built offshore wind farm, a Franco-Chinese cooperation fund, and substantial co-financing commitments between BNP Paribas and the Bank of China. Rym Momtaz, writing for Politico, speculated that the deal would "ratchet up pressure on Trump" to make a deal with the Chinese government.

May 2019: Trump stated that the previous tariffs of 10% levied on $200 billion worth of Chinese goods would be raised to 25% on May 10. With notification by USTR, the Federal Register on May 9 published the modification of duty on or after 12:01 a.m. Eastern Time Zone, May 10 to 25% for the products of China covered by the September 2018 action. The stated reason is that China reneged on already agreed-upon deals. Trump said the tariffs are "paid for mostly by China, by the way, not by us." Economic analysts concluded this was an incorrect assertion, as American businesses and consumers ultimately pay the tariffs, as real-world examples of tariffs working as intended are rare, and consumers of the tariff-levying country are the primary victims of tariffs, by having to pay higher prices. "It is inaccurate to say that countries pay tariffs on commercial and consumer goods – it is the buyers and sellers that bear the costs," said Ross Burkhart, a Boise State University political scientist. "Purchasers pay the tariff when they buy popular products. Sellers lose market share when their products get priced out of markets," Burkhart added. Trump signed Executive Order 13873, placing Huawei on the Department of Commerce's Entity List. According to Reuters, the move banned Huawei from buying vital parts and components from U.S. companies without special approval and effectively barred its equipment from U.S. telecom networks on national security grounds.

June 2019: During the G20 Osaka summit, Trump announced he and Xi Jinping agreed to a "truce" in the trade war after extensive talks. Prior tariffs are to remain in effect, but no future tariffs are to be enacted "for the time being" amid restarted negotiations. Additionally, Trump said he would allow American companies to sell their products to Huawei, but the company would remain on the U.S. Entity List. The extent to which this plan to temporarily exempt Huawei from previous bans would be implemented later became unclear, and, in the weeks later, there was no clear indication of the reversal of Huawei bans. After a meeting with Chinese leader Xi Jinping, Trump announced, "China is going to be buying a tremendous amount of food and agricultural products, and they're going to start that very soon, almost immediately." China disputed making such a commitment, and one month later, no such purchases had materialized. US Section 301-  Tariffs (10% to 25% increase on List 3, effective June 15) imposed, and China’s retaliation on some US products (a subset of $60 billion, effective June 1).

July 2019: China’s MFN tariff cut on ITA products. Trump tweeted, "China is letting us down in that they have not been buying the agricultural products from our great Farmers that they said they would." People familiar with the trade negotiations said China had made no firm commitments to purchase farm goods unless it was part of a comprehensive trade agreement. Official figures from China showed its second-quarter GDP growth at its slowest in 27 years. China announced an accelerated decrease in its holdings of U.S. Treasury bonds, targeting 25% of its current holdings of $1.1 trillion.

August 2019: Trump announced on Twitter that an additional 10% tariff will be levied on the "remaining $300 billion of goods". The Central Bank of China (PBOC) let the Renminbi fall over 2% in three days to the lowest point since 2008 as it was hit by strong sales due to the threat of tariffs. The U.S. Department of the Treasury officially declared China a Currency Manipulator after the People's Bank of China allowed its yuan to depreciate, according to CNN, which was seen as retaliation for Trump's August 1 tariff announcement. According to an article in The Washington Post, Trump reportedly pressured the Treasury Department's Steven Mnuchin to authorize the designation. Both the IMF and the Chinese government have rejected the designation, with the IMF saying that the valuation of the yuan is in line with China's economic fundamentals. China ordered state-owned enterprises to stop buying US agricultural products in retaliation for Trump's August 1 tariff announcement. Zippy Duvall, president of the American Farm Bureau Federation, called the move "a body blow to thousands of farmers and ranchers who are already struggling to get by," adding, "Farm Bureau economists tell us exports to China were down by $1.3 billion during the first half of the year. Now, we stand to lose all of what was a $9.1 billion market in 2018, which was down sharply from the $19.5 billion U.S. farmers exported to China in 2017." Official figures from China showed its industrial output growth falling amid the trade war to a 17-year low. Trump delayed some of the tariffs. $112 billion worth will still take place on September 1 (which means that on September 1, $362 billion total worth, including the newly imposed $112 billion, of Chinese products will face a tariff), but the additional, not yet imposed, $160 billion will not take effect until December 15. Trump and his advisors, Peter Navarro, Wilbur Ross, and Larry Kudlow, said that the tariffs were postponed to avoid harming American consumers during the Christmas shopping season. Chinese Ministry of Finance announced new rounds of retaliatory tariffs on $75 billion worth of U.S. goods, effective beginning September 1. Trump tweeted that he "hereby ordered" American companies to "immediately start looking for an alternative to China". According to an article in The New York Times, Trump's aides said that no order had been drawn up, nor was it clear one would be. In a tweet on the following day, Trump said that he had the authority to make good on his threat, citing the International Emergency Economic Powers Act of 1977. Furthermore, tariffs are to be raised from 25% to 30% on the existing $250 billion worth of Chinese goods beginning on October 1, 2019, and from 10% to 15% on the remaining $300 billion worth of goods beginning on December 15, 2019. At the G7 summit, Trump stated, "China called last night our top trade people and said 'let's get back to the table' so we will be getting back to the table and I think they want to do something. They have been hurt very badly, but they understand this is the right thing to do, and I have great respect for it." Chinese Foreign Ministry spokesman Geng Shuang said he was unaware of such a call, and Trump aides later said the call did not occur, but the president was trying to project optimism. Americans for Free Trade, an umbrella group for 161 trade associations across numerous industries, sent Trump a letter asking him to postpone all scheduled tariff increases. The next day, Trump said, "Badly run and weak companies are smartly blaming these small Tariffs instead of themselves for bad management."

September 2019: US Section 301 -  Tariffs of 15% (a subset of $300 billion, List 4A) imposed, and China’s retaliation on some US products (a subset of $75 billion): New US and Chinese tariffs previously announced went into effect at 12:01 pm EST. China imposed 5% to 10% tariffs on one-third of the 5,078 goods it imports from America, with tariffs on the remainder scheduled for December 15. The United States imposed new 15% tariffs on about $112 billion of Chinese imports, such that more than two-thirds of consumer goods imported from China were then subject to tariffs. The Office of the U.S. Trade Representative and Chinese state media confirmed that deputy-level meetings in mid-September would lead to ministerial-level talks in the coming weeks. At the same time, the United States Department of Commerce issued preliminary antidumping duty determinations on fabricated structural steel from Canada, China, and Mexico. Furthermore, China was found liable for dumping up to 141.38% of fabricated structural steel into the United States and thereby prompted the U.S. Customs and Border Protection to collect cash deposits at the same rate, as instructed by the Commerce Department. The People's Bank of China announced a 0.5 percent reduction in its reserve requirement ratio in response to the slowing of China's economic growth rates caused by the trade war. After China announced it was exempting 16 American product types from tariffs for one year, Trump announced he would delay until October 15 a tariff increase on Chinese goods previously scheduled for October 1. Trump asserted he granted the delay at the request of Chinese Vice Premier Liu He. Bloomberg News and Politico reported that Trump's advisors were increasingly concerned that the trade war was weakening the American economy going into the 2020 election campaign and were discussing ways to reach a limited interim deal. The Wall Street Journal reported China was seeking to narrow the scope of negotiations to place national security matters on a separate track from trade issues. China eliminated its tariff increase on soybeans, which it had imposed in 2018. The Wall Street Journal reported that Chinese retaliatory tariffs on lumber and wood products had caused hardwood lumber exports to China to fall 40% during 2019, resulting in American lumber mills slashing employment. A USDA spokesperson said the organization had provided the industry with $5 million in aid through its Agricultural Trade Promotion Program.

October 2019: Citing human rights issues, the United States Department of Commerce puts 20 Chinese public security bureaus and eight high-tech companies, such as HikVision, SenseTime, and Megvii, on the Export Administration Regulations Entity List. Like Huawei, which was sanctioned on an identical blueprint for national security reasons, the entities will need U.S. government approval before they can purchase components from U.S. companies. On October 11, 2019, U.S. President Donald Trump hosted a delegation of U.S.-China negotiators at the White House. Trump announced that the United States and China had reached a tentative agreement for the "first phase" of a trade deal, with China agreeing to buy up to $50 billion in American farm products and to accept more American financial services in their market, with the United States agreeing to suspend new tariffs scheduled for October 15. The deal was expected to be finalized in the coming weeks. At the same time, Chinese announcements did not express the same confidence, though a few days later the Chinese Foreign Ministry said that the two sides had the same understanding and had reached an agreement. Official figures from China showed its third-quarter GDP growth at its slowest in almost 30 years.

December 2019: Media reports indicated that China had ordered government agencies and public institutions to remove foreign computer equipment and software within three years, following a "3-5-2" replacement strategy. While not officially confirmed, this move was seen as part of the ITAI initiative. Increased funding and policy support were directed towards domestic IT companies to accelerate the development of homegrown technologies. Both countries announced an initial deal where new tariffs to be mutually imposed on December 15 would not be implemented. China says it "will increase purchases of high-quality agricultural products from the U.S.", while the United States says it will halve the existing 15% tariffs. The Wall Street Journal reported that the language of the phase one deal was expected to be released after the January 15 signing and that Lighthizer said some details would be classified.

Year 2020:

January 2020: China adjusts MFN tariff rates for 2020. Reuters reported that in December 2019, the American manufacturing sector fell into its deepest slump in over a decade, attributing the decline to the U.S.-China trade war. U.S. President Donald Trump and China's Vice Premier Liu He signed the U.S.-China Phase One trade deal in Washington, DC. The "Economic and Trade Agreement between the United States of America and the People's Republic of China" is set to take effect from February 14, 2020, and focuses on intellectual property rights (Chapter 1), technology transfer (Chapter 2), food and agricultural products (Chapter 3), financial services (Chapter 4), exchange rate matters and transparency (Chapter 5), and expanding trade (Chapter 6), with reference also being made to bilateral evaluation and dispute resolution procedures in Chapter 7. The agreement allows for a party to request additional consultation in the event of a "natural disaster or other unforeseeable event." Unlike other trade agreements, the US-China Phase One agreement did not rely on arbitration through an intergovernmental organization like the World Trade Organization, but rather through a bilateral mechanism. Official figures from China showed its 2019 economic growth rate falling amid the trade war to a 30-year low.

February 2020: US Section 201 - Tariffs reduced on solar panels and washing machines in the third year of the policy. US Section 232 - Import tariffs extended to products that use aluminum and steel Data from the Commerce Department of the United States showed the country's trade deficit falling amid the trade war for the first time in 6 years. US Section 301 - Tariffs of 15% imposed on September 1, 2019 (List 4A) cut to 7.5%, and China’s retaliatory tariffs imposed on September 1, 2019, cut in half. China grants tariff exemptions on 696 US goods to support purchases.

March 2020: The United States Trade Representative granted exemptions to tariffs on various types of medical equipment, after calls from American lawmakers and others to remove tariffs on these products in light of the COVID-19 pandemic in the United States.

May 2020: The Chinese government announced exemptions for tariffs on 79 additional US goods. The Chinese government announced that it would permit imports of barley and blueberries from the United States.

June 2020: As of June, China had risen to become the United States' top trading partner again, amid the global crisis caused by the COVID-19 pandemic. However, the countries were on track to miss the targets from the trade deal, hitting which would have been hard even under strong economic conditions, according to Chad Brown of the Peterson Institute for International Economics and Chenjun Pan of Rabobank. The economic damage and trade barriers caused by the pandemic made those targets even harder to reach.

July 2020: China’s MFN tariffs cut on ITA products.

September 2020: A three-person WTO panel found that the Trump administration tariffs violated global trade rules because they had been applied only to China and they exceeded the maximum rates the US had agreed to, without adequate explanation. Lighthizer responded that the finding showed "the WTO is completely inadequate to stop China's harmful technology practices." The US Commerce Department imposed restrictions on China's largest chip maker, Semiconductor Manufacturing International Corporation (SMIC), determining that an "unacceptable risk" of equipment supplied to SMIC could potentially be used for military purposes. Under the restrictions, the suppliers were barred from exporting the chip without a license.

November 2020: President Donald Trump signed an executive order prohibiting Americans from investing in shares of companies with ties to the Chinese military. New transactions would be barred from 11 January 2021, while investors who already held such stocks would have until November 2021 to divest them.

December 2020: By the end of 2020, China and the U.S. had achieved only 58% of the targets for U.S. exports to China under the phase one trade agreement. This was seen as a sign that the original targets were unrealistic. The U.S.-based Peterson Institute for International Economics said China had "failed spectacularly" to meet its import targets and "much of the deal was a failure."

Year 2021:

January 2021: China adjusts MFN tariff rates for 2021. The Trump administration banned cotton and tomato products originating in Xinjiang, including products manufactured outside of China but using cotton and tomatoes from Xinjiang, over forced labor allegations. On 6 January 2021, the New York Stock Exchange announced that it would delist stocks related to China Mobile, China Telecom, and China Unicom. Index provider MSCI also announced it would stop including China Mobile, China Telecom, and China Unicom in its benchmarks. Trump left office, and Joe Biden was inaugurated as president of the United States. Biden said that he did not have immediate plans to remove the tariffs and planned to review the phase one trade deal and discuss the matter with allies first. China imposed sanctions against outgoing US Secretary of State Mike Pompeo, former Secretary of Health and Human Services Alex Azar, former Under Secretary of State Keith J. Krach, outgoing US Ambassador to the United Nations Kelly Craft, and 24 other former Trump officials. Biden's National Security Council called the sanctions "unproductive and cynical."

February 2021: US Section 201 tariffs reduced on solar panels and washing machines in the fourth year of the policy (washing machines had received an extension). China's Foreign Minister Wang Yi called for US President Joe Biden to lift the multiple restrictions imposed by Trump. During a Foreign Ministry forum on US-China relations, he urged the Biden administration to lift the sanctions on trade and people-to-people contact, while asking it to stop interfering in China's internal affairs.

March 2021: High-level talks took place in Anchorage, Alaska, to discuss key geopolitical disagreements. The 14th Five-Year Plan (2021–2025) was released, emphasizing technological self-reliance and innovation as national priorities, reinforcing ITAI objectives across various sectors, including healthcare.

May and June, 2021: China’s MFN tariffs cut on some steel products. In May and June 2021, discussions continued between high-level officials, including Liu He and Wang Wentao from China and Katherine Tai, Janet Yellen, and Gina Raimondo from the United States. The Chinese Ministry of Commerce described the talks as candid, productive, and pragmatic,  while Tai and Yellen said they looked forward to further dialogue.

July 2021: China’s MFN tariffs cut on ITA products.

Year, 2022:

January 2022: China adjusts MFN tariff rates for 2022.

February 2022: US Section 201 tariffs were reduced on solar panels and washing machines in the fifth year of the policy (solar panels had received an extension).

May 2022: China’s MFN tariffs cut to zero on coal.

July 2022: China’s MFN tariffs cut on ITA products

December 2022: The WTO ruled that former US President Donald Trump was in breach of global trade rules in 2018 with his administration's tariffs on steel and aluminum. The Biden administration, however, disputed the panel's rulings and instead stated that they will not take away the duties that Trump had earlier established. Brussels had criticized the US for having rejected the WTO ruling. Bernd Lange, chairperson of the European Parliament's international trade committee, stated, "The USA's reaction of simply rejecting the ruling is incomprehensible. We have to have an honest discussion with the U.S. if they are moving away from a rules-based trading system, and if and how we can rescue the existing system." WTO ruled that the US was in breach of global trading rules for having claimed that products imported from Hong Kong could be marked as coming from China. Hong Kong's government welcomed the ruling and its secretary for commerce and economic development, Algernon Yau, stated that "the revised origin marking requirement is politically motivated" and "a vain attempt to interfere with Hong Kong's internal affairs through weaponizing trade". The US rejected the ruling and expressed that it had no intention of abiding. The United States Trade Representative spokesperson, Adam Hodge, stated the US responded to "highly concerning actions" by China to erode Hong Kong's autonomy and the democratic and human rights of its people, and so qualified to be a threat to the national security of the US. However, the WTO panel disagreed that tensions between the United States and Hong Kong have increased to be an "emergency in international relations", which is the threshold required to qualify for an exception. China started to establish sector-specific policies, continuing to develop regulations and standards to enforce the adoption of domestic technologies in critical sectors. Various government agencies and industry bodies have publicly promoted ITAI through conferences, official statements, and policy documents.

Year 2023:

January 2023: China’s MFN tariffs cut on selected products, effective MFN tariff increased on frozen chicken under conversion from special to ad valorem rate. European Commissioner for Internal Market Thierry Breton announced that the European Union will join the United States in blocking the sale of technology to China that would allow it to produce advanced semiconductor chips.

February 2023: US Section 201 tariffs reduced on solar panels in the sixth year of policy; Section 201 tariffs on washing machines expire. China expands the Unreliable Entities List to include Raytheon and Lockheed Martin.

June, 2023: US Secretary of State Antony Blinken visits China, the first secretary of state to visit China since 2018. Blinken met with Chinese Foreign Minister Qin Gang, CCP Foreign Affairs Commission Office Director Wang Yi, and CCP General Secretary Xi Jinping. Blinken sought to clarify the economic stance of the United States toward China, saying, "We are for de-risking and diversifying" and emphasizing that the US is not seeking to contain China economically. Yang Tao, director-general of the Chinese Foreign Ministry's North American and Oceanian Affairs department, rejected his explanation, telling reporters that the US is simply repackaging "decoupling" as "de-risking" from China.

July 2023: China's MFN tariff cut on ITA products. The US Treasury Secretary, Janet Yellen, criticized China's restrictions during her visit to Beijing, citing her concern over China's crackdown on US consulting firms and export controls on critical minerals used in computer chip manufacturing. She stressed that the US's goal is to expand its economic partnership with China, rather than sever it.

December 2023: China’s MFN tariffs on coal revert to a higher, binding rate.

Year 2024:

January 2024: China adjusts MFN tariff rates for 2024.

May 2024: The Biden administration doubled tariffs on solar cells imported from China and more than tripled tariffs on lithium-ion electric vehicle batteries imported from China. It also raised tariffs on imports of Chinese steel, aluminum, and medical equipment. The tariff increases will be phased in over three years.

June 2024: US Section 201 tariffs reduced on solar panels in the seventh year of the policy.

September 2024: US Section 301 - Tariffs adjusted on selected Chinese products, including electric vehicles. The Biden administration finalized the increase of tariffs on Chinese exports. Tariffs increased to 100% on electric vehicles, 50% on solar cells, and 25% on electric vehicle batteries, critical minerals, steel, and aluminum. The tariffs took effect beginning on September 27, 2024.

December 2024: Following China's escalating conflict with the United States over trade, Chinese manufacturers have recently restricted sales of key components used in drone construction to the United States. China launched an investigation against Nvidia due to alleged violations of anti-monopoly laws.

The US-China trade war latest updates from January 2025 to April 2025:

January 01, 2025: China adjusts MFN tariff rates for 2025. US Section 301 - Tariffs imposed on selected Chinese products, including tungsten, wafers, and polysilicon.

January 20, 2025: Trump’s second term begins with a focus on U.S.-China trade relations: President Donald Trump marked the start of his second term with a broad trade policy directive, prioritizing a methodical review of the United States' trade relationships, including a sharp focus on China. While no immediate tariffs were announced, the administration signaled its intention to evaluate Beijing’s adherence to the 2020 trade agreement and address trade imbalances. Key developments include: Trade memo announcement: The memo, issued shortly after Trump’s inauguration, directs federal agencies to scrutinize trade deficits and unfair practices by major trading partners, with China being a key focus. 2020 trade deal under review: Trump’s directive includes assessing China’s compliance with the 2020 deal, which required Beijing to increase purchases of US goods by US$200 billion annually—a commitment largely unmet due to the pandemic. Avoiding immediate tariffs: Contrary to campaign rhetoric promising steep tariffs on Chinese imports, the administration appears to be taking a more strategic approach. Analysts suggest this could calm financial markets in the short term. Universal tariff expected: Trade experts believe Trump remains committed to imposing a global tariff as part of his economic agenda. The administration is expected to invoke statutes like Section 232 or Section 301 for future trade actions. Trump’s measured approach to tariffs suggests a possible window for negotiations, but the administration’s broader goals, such as pushing China to fulfill its trade commitments, may lead to renewed tensions. The directive reinforces the administration’s intent to hold China accountable for practices perceived as unfair, maintaining pressure in line with Trump’s first-term trade strategy. This measured start to Trump’s second term reflects his administration’s continued focus on reshaping US-China trade ties, signaling challenges ahead for the bilateral relationship.

January 22, 2025: Trump threatens 10% tariff on China over Fentanyl from Feb 01: On January 22, 2025, during a White House event, President Donald Trump announced plans to impose a 10 percent tariff on Chinese imports as soon as February 01, citing concerns over fentanyl shipments. He accused China of sending fentanyl to Mexico and Canada, which he claimed was then trafficked into the United States. In response, Chinese Foreign Ministry spokesperson Mao Ning stated during a routine press briefing that China firmly opposes trade wars and tariff measures, emphasizing that “there are no winners in trade wars, and China will resolutely safeguard its national interests.”

February 01, 2025: US tariffs of 10 percent were imposed on all imports from China under the International Emergency Economic Powers Act (IEEPA). Trump signs executive order slapping 10% tariff on Chinese imports: President Trump signed an Executive Order (EO) imposing an additional 10 percent tariff on Chinese goods entering the country, ostensibly to curb the import of fentanyl and other illicit substances. Canada and Mexico were separately hit with 25 percent additional tariffs under the same rationale. The additional tariffs will be levied “until the [illicit drug] crisis is alleviated”, according to a White House Fact Sheet. The Fact Sheet also accused China of failing “to take the actions necessary to stem the flow of precursor chemicals to known criminal cartels and shut down money laundering by transnational criminal organizations”. Under the Biden administration, the US and China increased collaboration to tackle the export of fentanyl and precursor chemicals from China to the US, launching the US-China Counternarcotics Working Group in January 2024. The initiative was a key part of the efforts to resume US-China cooperation on a variety of issues following years of diplomatic gridlock and, at the time, was viewed as an easy win for the Biden administration. In April 2024, then US Treasury Secretary Janet Yellen announced the launch of the Joint Treasury-People’s Bank of China Cooperation and Exchange on Anti-Money Laundering. It is unclear whether these efforts will continue under Trump. In addition to the tariffs, the EOs also announced a halt to the De Minimis exemption, which exempts parcels valued below US$800 from customs inspections and tariffs. The Trump administration has blamed small packages that fall under this threshold for the illegal import of fentanyl and precursor chemicals. The suspension of the De Minimis exemption could significantly impact Chinese e-commerce giants like Shein and Temu, which have established vast customer bases in the US. Their business models heavily rely on exploiting this loophole by shipping low-value parcels directly from manufacturers in China to American consumers. The tariffs will go into effect at 00:01 Eastern Time (13:01 China Standard Time) on Tuesday, February 4. In response to the tariffs, a Chinese Foreign Ministry spokesperson said that China would “take necessary countermeasures to defend its legitimate rights and interests” and that the move violated WTO rules. China’s Ministry of Commerce also stated that it would file a lawsuit with the WTO and threatened to use countermeasures to “safeguard its rights and interests”.

February 4, 2024: US Postal Service suspends all parcels arriving from Mainland China and Hong Kong: In a notice posted to its website, the USPS announced that it would temporarily suspend international packages from the Chinese mainland and Hong Kong “until further notice”, effective the same day. Letters and “flats” (large envelopes, newsletters, and magazines) are unaffected. On February 1, Trump signed an Executive Order that, among other actions, halted the de minimis exemption allowing parcels below US$800 in value to bypass customs inspections and duties when entering the US. The stated reason for halting the exemption is to prevent the import of fentanyl and chemical precursors, which arrive in the US via these types of small packages. The halting of packages from China will severely affect online retailers such as Shein, Temu, and Amazon, as well as countless smaller retail businesses, whose business models are substantially based on exploiting this loophole. It will also have an immediate impact on American consumers, as millions of parcels that have already been shipped will be stuck in customs for an indeterminate amount of time. An analyst told Reuters that four million de minimis packages arrived in the US per day in 2024. China imposes tariffs on US imports and implements export controls on rare earths in retaliation for Trump’s tariff hike: Shortly after the Trump administration’s 10 percent additional tariff on Chinese imports took effect, China’s Customs Tariff Commission announced a series of retaliatory tariffs on goods originating from the United States. These are: A 15 percent tariff on coal and liquefied natural gas. A 10 percent tariff on crude oil, agricultural machinery, large-displacement cars, and pickup trucks. Additionally, corresponding tariffs will be imposed based on the current applicable tariff rates. Existing bonded and tax reduction, and exemption policies will remain unchanged, and the additional tariffs will not be reduced or exempted. These tariffs are set to take effect on February 10. In addition to the tariff increase, China’s Ministry of Commerce and Customs Administration announced export controls on 25 rare earth metal items, citing the need to “safeguard national security and interests and fulfill international obligations such as non-proliferation.” The items subject to export controls include various derivations of tungsten, tellurium, bismuth, and molybdenum, critical materials for industries such as electronics, aerospace, and renewable energy. While the announcement did not explicitly link the export controls to US tariffs, China’s role as one of the largest producers of rare earth metals makes these products a significant bargaining chip in the context of a potential trade war. In an executive order signed on his first day in office, Trump called for “Restoring America’s Mineral Dominance,” which included expanding access to land for mining in the US. He has also pursued efforts to expand access to critical minerals overseas, including threatening to annex Greenland and recently demanding that Ukraine provide access to rare earths in exchange for military aid. Separately, the Trump administration imposed 25 percent tariffs on Canada and Mexico but postponed their implementation by 30 days in both cases following negotiations. However, no such deal has been reached between China and the United States. According to White House Press Secretary Karoline Leavitt, Trump is expected to speak with President Xi Jinping “in the next couple of days,” according to Reuters. China announces an antitrust probe into Google, adds two US companies to the Unreliable Entities List: China’s State Administration for Market Regulation (SAMR) announced that it has launched an investigation into Google for suspected violations of China’s Anti-Monopoly Law. The statement, published on SAMR’s website, did not provide specific details of the alleged violations. This news was released just one minute after the US’s 10 percent tariffs on Chinese imports took effect. While Google’s search engine has not operated in China since 2011 and its Gmail service ended in 2014, some Google services and products, such as the Google Chrome browser, are still available in the country. At the same time as the Google antitrust probe announcement, China’s Ministry of Commerce declared that it is adding two major US companies to its Unreliable Entities List: biotech giant Illumina, Inc., and fashion conglomerate PVH Group, the parent company of Calvin Klein and Tommy Hilfiger. According to the Ministry, the two companies “violated normal market trading principles, interrupted normal transactions with Chinese companies, adopted discriminatory measures against Chinese companies, and seriously damaged the legitimate rights and interests of Chinese companies.” Placement on the Unreliable Entities List subjects these companies to a range of potential penalties, including import and export restrictions, investment limitations, restrictions or prohibitions on company personnel entering China, revocation of work, stay, or residence permits for foreign staff, and fines. Illumina has expanded its presence in China in recent years, establishing its first manufacturing site in Shanghai in 2022. Meanwhile, PVH Group has seen strong growth in the Chinese market, citing a 20 percent year-on-year increase in revenue in RMB terms in its 2023 Year in Review.

February 7, 2025: Trump pauses executive action ending de minimis exception: The Trump administration released an amendment to an Executive Order deferring the end to the de minimis exception after its sudden implementation on February 4 caused chaos at US logistics centers and customs warehouses. An estimated four million packages entered the US per day in 2024 under the de minimis exception, which allows packages under US$800 in value to forgo customs inspections and duties. The amendment states that duty-free de minimis treatment will be available on eligible packages until “adequate systems are in place to fully and expediently process and collect tariff revenue”. On February 4, the US Postal Service also announced a temporary suspension of international packages from the Chinese mainland and Hong Kong, but reversed this decision the next day. US Section 201 - Tariffs reduced on solar panels in the eighth year of the policy.

February 9, 2025: Trump announces plan to impose 25% steel and aluminum tariffs on all trading partners Speaking to reporters on Air Force One, Trump announced he would impose an additional 25 percent tariff on US steel and aluminum imports. The new tariff, which will reportedly be officially announced and take effect on Monday, will be added to all existing duties. In September 2024, the Biden administration raised the tariff on imports of Chinese steel and aluminum products to 25 percent. China’s steel and aluminum exports to the US have fallen in recent years and make up a small percentage of China’s overall exports.  In addition to the steel and aluminum tariffs, Trump said he would announce global reciprocal tariffs soon, which would go into effect immediately.

February 10, 2025: Trump states he has spoken to Xi Jinping: In an interview with Fox News, Trump stated that he has spoken to Chinese President Xi Jinping “and his people” since the inauguration on January 20, without saying when the talk took place or what was discussed. Trump added that he “loved talking to him” and that they have “a very good personal relationship”. The Chinese side has not confirmed when or whether the call took place, and the last confirmed communication between the two leaders was a phone call on January 17. A White House spokesperson said last week that Trump would speak to Xi Jinping within a few days, but no update has been given on the status of the talks. Trump announces 25% tariff on steel and aluminum imports: President Trump signed a proclamation announcing a 25 percent ad valorem tariff on all steel imports into the US and raising tariffs on aluminum imports from 10 to 25 percent. The tariffs will apply to imports from all countries and regions “without exception”, and will take effect on March 12. According to the proclamation, the 25 percent tariff imposed on steel by Trump in 2018 effectively reduced the US’s reliance on imports and increased the consumption of domestic supply. However, the proclamation asserts that various exemptions and alternative agreements negotiated with multiple countries and entities during the Trump and Biden administrations have led to imported steel comprising a proportion of US consumption comparable to levels before the initial tariff imposition. Additionally, the proclamation states that there is a “global excess capacity crisis” and that increasing Chinese steel exports in recent years are “displacing production in other countries and forcing them to export greater volumes of steel articles and derivative steel articles to the United States.” As a result, the US will terminate all agreements and exemptions made with different trade partners and entities, and the 25 percent tariff will be reinstated for all steel imports. Chinese direct exports of steel to the US are very small, accounting for just 0.8 percent of China’s total steel exports in 2024. However, Chinese steel exports to countries that are major sources of steel imports for the US, such as Vietnam and Canada, accounted for 25.22 percent of China’s total steel exports in 2024, according to Investor.org.cn. As the tariff is effective worldwide, it will indirectly affect Chinese steel re-exports to the US via these third countries, thereby significantly impacting China’s global steel exports. China retaliates against US tariffs under the IEEPA imposed on February 4.

February 13, 2025: Trump signs plan to impose reciprocal tariffs on all trade partners: Trump signed a memorandum directing key ministers to implement a plan to impose reciprocal tariffs on all trade partners. The “Fair and Reciprocal Plan” will examine non-reciprocal trade relationships with all trade partners, including tariffs on US products, unfair, discriminatory, or extraterritorial taxes on US businesses, workers, and consumers (including VAT), nontariff barriers or measures, including subsidies and regulatory requirements, and policies and practices that cause exchange rates to deviate from their market value. Examples where the US’s trade partners do not provide reciprocal tariffs on American goods cited in a Fact Sheet include a 10 percent tariff imposed by the EU on American imported cars, while the US imposes a 2.5 percent tariff on European imported cars. Should the plan be implemented as intended, tariffs on car imports from the EU will rise to 10 percent. The tariffs that Trump has imposed on products such as steel and aluminum, as well as the 10 percent tariff placed on Chinese goods, would be in addition to the reciprocal tariffs. The broad scope of the types of duties and trade barriers targeted by the reciprocal action means further tariffs on Chinese goods could be very extensive. The US has in the past accused China of unfairly subsidizing the production of various goods to the detriment of its domestic industries, and China also imposes VAT on most goods and services, ranging from six to 13 percent. In January of this year, the US Trade Representative released the results of an investigation into China’s shipbuilding subsidies, which concluded that China’s “targeting for dominance burdens or restricts U.S. commerce by undercutting business opportunities for and investments in the U.S. maritime, logistics, and shipbuilding sectors”. The report further stated that “responsive action is appropriate”. It is also likely that the US’s major trading partners, such as the EU, will impose countermeasures on US goods in response to Trump’s actions.

March 3, 2025: Trump raises tariffs on Chinese goods to 20%, effective March 4: The Trump administration has officially raised the tariff rate on Chinese imports from 10 to 20 percent through an executive order (EO). The EO states that the increase to the 10 percent tariff initially implemented on February 4 is necessary as China “has not taken adequate steps to alleviate the illicit drug crisis through cooperative enforcement actions”. The new tariff rate takes effect on March 4. He also implemented new 25% tariffs on imports from Mexico and Canada, thereby initiating new trade disputes with the three primary US trading partners. The Global Times, a sister publication of the state news organization The People’s Daily, reported that China was considering responding with counter-tariffs on US agricultural goods.

March 4, 2025: US tariffs of 10 percent on all imports from China under IEEPA. China counters Trump’s tariffs with duties on US agricultural products: China’s Ministry of Finance (MOF) has announced a series of counter-tariffs on crucial US agricultural goods, one day after Trump increased tariffs on Chinese goods to 20 percent. The tariffs on US goods are as follows: A 15 percent tariff on chicken, wheat, corn, and cotton. A 10 percent tariff on sorghum, soybeans, pork, beef, aquatic products, fruits, vegetables, and dairy products. The MOF announcement stated that “the unilateral tariff increase by the US side undermines the multilateral trading system, increases the burden on US companies and consumers, and undermines the basis for economic and trade cooperation between China and the US.” The tariffs will come into effect on March 10. In a separate announcement, China’s Ministry of Commerce stated that China has sued the US under the WTO’s dispute settlement mechanism for the latest tariff hike, stating that it violates the WTO’s rules and “undermines the basis for economic and trade cooperation between China and the United States”. The targeting of US agricultural products is calculated. China is one of the world’s largest importers of agricultural products and a major buyer of US soybeans, corn, and sorghum. Agricultural products were a core component of the trade deal struck between China and the Trump administration in 2019, which saw China commit to purchasing around US$200 billion in agricultural goods from the US over two years. The US’s agricultural producers are also mainly located in the US’s red states, meaning the tariffs will hit Trump’s core voter base the hardest.

March 10, 2025: China retaliates against US tariffs under IEEPA imposed on March 4.

March 12, 2025: US Section 232 -  Tariffs imposed on steel, aluminum, and derivative products.

March 20, 2025: US Department of State and the US Treasury Secretary sanctioned a Chinese oil terminal and refinery: The US Department of State sanctioned the Huaying Huizhou Daya Bay Petrochemical Terminal Storage in Guangdong for allegedly “buying and storing Iranian crude oil from a sanctioned vessel.” Meanwhile, the Department of the Treasury (the Treasury) concurrently sanctioned the Shouguang Luqing Petrochemical Co., Ltd, an oil refinery in Shandong, for purchasing and refining hundreds of millions of dollars’ worth of Iranian crude oil.” In addition, the Treasury sanctioned 12 entities and one individual and identified eight vessels as blocked property (property owned by sanctioned entities) for purportedly being part of Iran’s so-called “shadow fleet” of tankers, which ship “millions of barrels of Iranian oil to China”. These sanctions are designed to end Iran’s oil exports. The US alleges that income derived from Iran’s oil exports is funding Iran’s attacks on US allies and helping to fund US-designated terrorist groups. In a regular press meeting, Foreign Ministry Spokesperson Mao Ning called the action an “abuse of illicit unilateral sanctions and long-arm jurisdiction” and called for the US to stop “disrupting the normal business cooperation between China and Iran”. She also cautioned that China will “take all measures necessary to firmly safeguard the lawful rights and interests of our companies”.

March 23, 2025: Premier Li Qiang meets with US Senator Steve Daines: Chinese Premier Li Qiang met with Republican Senator Steve Daines, along with a group of American business executives, in Beijing as part of the annual China Development Forum. According to the readout of the meeting, Li urged communication between China and the US, stating that “Both sides should choose dialogue rather than confrontation, and choose win-win cooperation instead of a zero-sum game.” He also emphasized the importance of trade in bilateral relations, warning that “the more difficulties bilateral relations face, the more important it is to safeguard and develop China-US economic and trade cooperation.” This was the first meeting between Chinese and US officials since Trump took office in January and comes amid an escalating trade war that has seen the US place 20 percent tariffs on goods coming from China. During the last Trump administration, Daines played an important role in the negotiations for the Phase One US-China Trade Agreement, particularly in advocating for agricultural interests.

March 25, 2025: US Commerce Department adds over 50 Chinese Entities to the Entity List: The Bureau of Industry and Security (BIS) under the US Department of Commerce added 80 entities from a range of countries, over 50 of which are from China. According to the press release, the purpose of including these companies in the list is to restrict China from acquiring and developing high-performance and exascale computing capabilities and quantum technologies for military applications, as well as impeding China’s development of hypersonic weapons. The entities notably include six subsidiaries of the Chinese cloud computing and big data services provider Inspur Group, including Inspur’s subsidiary in Taiwan (Inspur Taiwan). These entities were added, “for their contributions to Inspur’s development of supercomputers for military end use, particularly by acquiring or attempting to acquire U.S.-origin items in support of supercomputer projects for the Chinese government and/or military”. Inspur Group was placed on the Entity List in 2023. Other entities added to the list include the Beijing Academy of Artificial Intelligence, a non-profit AI research lab; Nettrix Information Industry, a server manufacturer and IT system provider; and Suma Technology. Companies included on the Entity List will be subject to export restrictions, and US companies will be unable to do business with the entities without a license. In a regular press briefing, Foreign Ministry Spokesperson Guo Jiakun called the latest action “an abuse of [the US’s] entity list and other export controls” and that they violated international law. He also repeated the line that “China will take necessary steps to firmly safeguard the lawful rights and interests of Chinese companies”, suggesting possible retaliation.

March 26, 2025: US Trade Representative Jamieson Greer Holds Video Call with Chinese Vice Premier He Lifeng US Trade Representative Jamieson Greer and Chinese Vice Premier He Lifeng held a video call on March 26 to discuss the U.S.-China economic and trade relationship. According to the US Trade Representative (USTR) readout, Greer emphasized President Trump’s commitment to a reinvigorated trade policy that strengthens domestic industry, safeguards national security, and ensures fair competition for American workers. He also raised concerns about China’s trade practices, which the US views as unfair and anticompetitive. Meanwhile, according to the China State Council readout, Vice Premier He conveyed China’s concerns over additional US tariffs, particularly those tied to fentanyl-related issues and the Section 301 investigation. He urged the US to engage in equal consultations to address trade disputes. Both sides agreed that maintaining a stable economic relationship is in their mutual interest. The meeting took place against the backdrop of Trump’s 20 percent tariffs on Chinese goods, which remain a key issue in bilateral trade talks. According to reports, Trump has suggested he may consider lowering tariffs on China in exchange for a deal over TikTok, which is coming up against an April 5 deadline to be sold or face a potential US ban.

April 2, 2025: Trump reinstates the end to de minimis exemption on Chinese parcels, effective May 2: President Donald Trump signed an executive order (EO) to once again end the de minimis exemption for parcels originating from the Chinese mainland and Hong Kong. The de minimis exemption allows low-value packages – those worth under US$800 – to enter the US without customs duties or inspections. According to analysts, roughly four million packages per day entered the US under this exemption in 2024, many of them from Chinese e-commerce companies. Trump had previously attempted to revoke the exemption as part of his February 1 tariff package, but reversed the move within a week. On February 7, the White House issued an amendment delaying the change, following chaos at US logistics centers and customs warehouses. The US Postal Service had also temporarily suspended the acceptance of international parcels from the Chinese mainland and Hong Kong, but quickly reversed course. The latest executive order claims that “adequate systems” are now in place to assess and collect duties on incoming parcels. As a result, the US will begin imposing duties on small-value packages from the Chinese mainland and Hong Kong starting May 2, 2025. The Trump administration has justified the move by alleging that Chinese-based shippers use the de minimis channel to engage in deceptive shipping practices. The EO states that some Chinese exporters “hide illicit substances and conceal the true contents” of parcels, avoiding detection due to the limited screening associated with de minimis treatment. The White House has linked this to broader concerns about fentanyl trafficking, which it claims is facilitated in part through these small parcels. Under the new rules, packages from mainland China and Hong Kong will be subject to the following duties:   Ad valorem duty of 30 percent of the declared value of the postal item Specific duty: US$25 per item between May 2 and May 31, 2025 US$50 per item beginning June 1, 2025 The EO directs the Secretary of Commerce to assess the potential impact of the order on American consumers and businesses, and provide a recommendation on whether the end of the exemption should also be extended to Macau “to prevent circumvention of this order”. The end of the exemption is expected to have widespread implications for online retailers such as Shein, Temu, and Amazon, as well as for smaller US businesses that rely on low-cost Chinese imports. Analysts warn that the decision will also affect millions of American consumers by raising prices and causing delays at customs due to backlogs and new inspection protocols. Trump imposes sweeping tariffs, raising Chinese import duties to 54% : ​On April 2, 2025, President Donald Trump announced a comprehensive overhaul of US trade policy, introducing significant tariffs on imports from various countries. This “Liberation Day” initiative aims to address perceived trade imbalances and bolster domestic industries.​ Key highlights include: Universal tariff: A baseline 10 percent tariff will be applied to all imports entering the United States. ​ China: Trump raised the tariffs on China by another 34%, after accusing China of tariff and non-tariff trade barriers of 67% as part of his reciprocal tariffs policy, expressed during his "Liberation Day" speech. The White House confirmed tariffs would stack on top of previous impositions, resulting in an effective tariff rate of 54% on all Chinese imports to the US beginning in one week. Tariffs on other nations: Vietnam, Thailand, Cambodia, the European Union, and Japan will be subject to new tariffs of 46 percent, 36 percent, 49 percent, 20 percent, and 24 percent, respectively. Sector-specific tariffs: Additional duties of 25 percent will be imposed on foreign automobiles, car parts, steel, and aluminum. ​ The universal 10 percent import tariff is set to take effect on April 5, 2025.​ The additional “reciprocal” tariffs targeting specific countries will commence on April 9, 2025. ​The additional 25 percent tariff on foreign automobiles, car parts, steel, and aluminum would go into effect at midnight on April 3, 2025.

April 03, 2025: US Section 232 -  Tariffs of 25 percent imposed on automobiles.

April 4, 2025: Trump signs executive order delaying implementation of TikTok ban: Trump signed a second executive order on Friday, delaying the ban on TikTok for another 75 days, one day before the ban was set to go into effect. This is the second executive order signed by Trump to delay the ban-or-sell deadline that was imposed by the TikTok divestment bill, which was signed into law by former President Joe Biden in April 2024. According to reports, TikTok’s owner, ByteDance, was close to reaching a deal with the Trump administration to sell the US portion of TikTok, as required by the bill. However, this deal had been scuppered by the announcement of an additional 34 percent reciprocal tariff on Chinese goods on April 2. It now appears likely that the Chinese government will seek to use the sale of TikTok as leverage in any potential trade negotiations with the US. China’s market regulator launches antitrust probe into DuPont: In a brief statement on its website, China’s State Administration for Market Regulation (SAMR) announced it has initiated an investigation into DuPont China Group Co., Ltd., the Chinese subsidiary of the American chemicals giant DuPont, for suspected violations of China’s Anti-Monopoly Law. While SAMR did not provide any information on the basis for the investigation into DuPont, according to a notice posted on the US Securities and Exchange Commission (SEC) website, the probe is about DuPont’s Tyvek business. Tyvek is a trademarked synthetic polyethylene material that is used widely in a variety of civilian and military settings. According to reporting by Chinese media, DuPont has held a monopoly over this material and sought to use litigation to suppress smaller companies in China that have developed new technologies with similar performance. The announcement of this probe is likely timed to act as a response to the 34 percent additional reciprocal tariff that Trump imposed on China on April 2. After Trump’s initial 10 percent tariff was placed on China in early February, SAMR launched an investigation into Google for suspected violations of the Anti-Monopoly Law. China retaliates with a 34% additional duty on all US goods, export curbs, and sanctions on US companies: China’s State Council Tariff Commission, in an announcement on Friday placed an additional 34 percent tariff on all goods entering the country from the US. Any current bonded and tax reduction, and exemption policies will remain in place. The new tariff will take effect from April 10, 2025. However, for goods that have been shipped before April 10 and arrive in China between April 10 and May 13, the new rate will not apply. This rate exactly matches the 34 percent tariff imposed on China by the Trump administration on April 2. However, the rate applied to China is in addition to the preexisting 20 percent rate imposed by Trump, meaning the final tariff rate on China will be 54 percent when the reciprocal tariff goes into effect on April 9. The 34 percent rate that China has applied to US goods will also be on top of any other existing tariffs for the applicable goods. On the same day, China’s Ministry of Commerce (MOFCOM) and the Customs Administration placed export restrictions on seven different types of rare earths, namely various derivations of samarium, gadolinium, terbium, dysprosium, lutetium, scandium, and yttrium. A MOFCOM spokesperson stated that these items have “dual-use attributes” and that the export controls are aimed at “better safeguarding national security and interests and fulfilling international obligations such as non-proliferation”. MOFCOM also placed 16 American companies on the “export control list” and 11 American companies on the “unreliable entities list”. The stated motive for this move is “to safeguard national security and interests and fulfill international obligations such as non-proliferation”. The companies placed on the export controls list, which are mostly defense companies, include High Point Aerotechnologies, Sierra Nevada Corporation, Hudson Technologies Co., and Cyberlux Corporation. The companies placed on the unreliable entities list include Skydio Inc., BRINC Drones, Inc., and Red Six Solutions. According to a statement from the MOFCOM spokesperson, these companies have “carried out so-called military and technical cooperation with Taiwan despite China’s strong opposition, seriously undermining China’s national sovereignty, security and development interests”. Companies included on the export control list will be barred from purchasing certain goods and products from China. Meanwhile, the companies included on the unreliable entities list are prohibited from engaging in import and export activities related to China and may not make any new investments in China.

April 05, 2025: US tariffs of 10 percent are imposed on nearly all countries, including China, under IEEPA, but with some sector carve-outs.

April 07, 2025:  Trump threatened to impose an additional 50% tariff on Chinese goods on April 9 if China did not withdraw its retaliatory measure of a 34% tariff on all US goods by April 8. This would boost the effective 54% tariffs on China on April 9 to 104%.

April 09, 2025: US tariffs ranging from 1 percent to 74 percent are imposed on nearly all countries with a trade surplus with the US, including China (74 percent), under IEEPA. US tariff on China includes an additional 50 percent tariff as counter-retaliation for China’s retaliation announcement.

April 10, 2025: US further raises the de minimis duty to 120%: In the executive order signed on Wednesday (April 10, 2025) raising the reciprocal tariff on China to 125 percent, the Trump administration again raised the duties and fees for de minimis parcels arriving from the Chinese mainland and Hong Kong. The new duties are as follows: An ad valorem tariff of 120 percent on the declared value of the parcel (up from 90 percent); or A per-item rate of US$100 (up from US$75) from May 1, rising to S$200 (up from US$150) from June 1. A White House spokesperson clarified to CNBC on Thursday (April 10, 2025) that the 125 percent reciprocal tariff rate imposed on China would be in addition to the 20 percent tariff imposed on China before April 2, bringing the final tariff rate to 145 percent. Moreover, the CNBC reporter found that the 145 percent tariff is the minimum tariff, meaning it will be levied on top of any other existing tariffs. This would include the Section 301 tariffs imposed during Trump’s first term, as well as the tariffs imposed by Biden on electric vehicles, solar panels, semiconductors, and other products. Trump’s initial executive order imposing reciprocal tariffs on global trade partners, including China, exempts certain items from the reciprocal tariffs, such as the 25 percent levy on steel and aluminum implemented in February. However, in practice, this would not apply to China as the Biden administration already imposed a 25 percent duty on these products coming from China in 2024. China retaliates against US tariffs under IEEPA imposed on April 5 and 9 by imposing tariffs of 84 percent; the US eliminates tariffs imposed on April 9 on trade surplus countries under IEEPA, except China, which faces an additional 41 percent tariff increase under IEEPA (to 125 percent total). Speaking at a regular press conference on April 10, Foreign Ministry spokesperson Lin Jian said that “there are no winners in tariff wars and trade wars” and added that “China does not want to fight, but is not afraid of fighting”. He also reiterated that China will “fight to the end” should the US continue its escalations.

April 11, 2025: China raises tariff on US goods to 125%, says it will no longer respond to US tariff hikes. The State Council Tariff Commission announced on Friday (April 11, 2025)  that it will further raise the tariff on US imports from 84 percent to 125 percent, matching the reciprocal tariff rate Trump imposed on China on April 9. The new tariff rate will take effect on April 12. The announcement also once again stated that the US’s imposition of abnormally high tariffs on China “seriously violates international trade rules” and is an act of “unilateral bullying and coercion”. Notably, the announcement also stated that, given that importing goods from the US to China will not be viable at the current tariff rate, China will no longer respond to any further tariff hikes from the US side. However, speaking at a regular press conference on Friday (April 11, 2025), Foreign Spokesperson Li Jian repeated the line that “China will fight to the end” if the US continues its escalations and that “China does not wish to fight, but it is not afraid to fight.” He also called for resolving the issue through dialogue and negotiation “based on equality, mutual respect, and reciprocity”. The US-China trade war has reached new heights as Beijing raised its retaliatory tariffs on US goods to 125%, hitting back against US President Donald Trump's decision to hike duties on Chinese goods to 145%.  Chinese leader Xi Jinping on Friday (April 11, 2025) made his first public comments on the escalating trade conflict, telling Spanish Prime Minister Pedro Sanchez in Beijing that "there are no winners in a trade war, and going against the world will only lead to self-isolation." Xi also stressed that Beijing is "not afraid" and expressed confidence in the nation's ability to overcome the challenges posed by US President Donald Trump's policies. "Regardless of how the external environment changes, China will remain confident, stay focused, and concentrate on managing its affairs well," Xi was quoted as saying by Chinese state broadcaster CCTV.

April 12, 2025: China retaliates against US tariffs under IEEPA imposed on April 10, to reach levels of recent US tariff increases of 125 percent.

Frequently Asked Questions (FAQs):

How do tariffs affect the economy? Like other trade policies, trade tariffs have both winners and losers. Tariffs can generate billions of dollars of added revenue for a country. Domestic industries and manufacturers tend to benefit. Consumers and producers who use those products associated with tariffs have to pay higher prices, which can have an inflationary effect on the rest of the economy. As for retaliatory tariffs imposed by foreign countries on the U.S., they make exports more expensive to buyers in those countries but reduce U.S. GDP by a negligible amount.

Are Tariffs Good or Bad for the Economy? Most economists agree that tariffs are bad for the economy since they prevent countries from reaping the benefits of economic specialization. However, there may be additional benefits to protecting certain domestic industries, such as manufacturing or defense. While it may be cheaper for a country to source arms on the world market, there are also strategic advantages to maintaining domestic production capacity, even if such products are available at lower prices elsewhere.

Is the United States in a Trade War With China? Yes. In 2024, the U.S. implemented extreme tariffs that some experts described as a trade war. President Biden raised the tariff on Chinese electric vehicles to 100% and increased the tariff on lithium-ion batteries to 25%. The tax rates on solar cells and semiconductors increased to 50%. These tariffs were meant to protect domestic industries, at the cost of denying Americans access to cheaper Chinese technologies. In 2025, the trade war between the USA and China will still be on.

Will Beijing fight on alone? Despite the global impact of Trump's sweeping tariffs, China finds itself alone in this "retaliation" battle, as other Asian leaders, including Vietnam, Cambodia, and India, quickly expressed their willingness to ease tensions with the US, while Japan and South Korea sent officials to engage in discussions. "I think a lot of this is due to Beijing's misjudgment of the situation," said Wang, adding that China believed everyone would follow them once they took a strong stance. "But instead of following the steps of Beijing, countries rushed to call Trump and arrange negotiations," the expert pointed out. On the other hand, Beijing's approach also aims to reinforce and respond to rising nationalist sentiment within China, experts say. Under Xi Jinping's leadership, Beijing has long embraced a tough and confrontational "wolf warrior" diplomacy, with anti-American sentiment intensifying as bilateral relations grow strained. "But there's also a risk that the animosity generated may be difficult to reverse and control," Chong noted. "It creates a situation where China is likely less willing to compromise, especially if that compromise becomes visible."

Are the US and China moving toward decoupling? The escalating tit-for-tat tariffs and the unwillingness of either side to initiate talks could lead to a breakdown of trade ties between the world's largest economy, the US, and the second-largest economy, China. "The US and the PRC (People's Republic of China) right now are trying to see who can impose more pain on the other side," Chong Ja Ian, an associate professor of political science at the National University of Singapore, told DW. Although China's reliance on the US market for trade has diminished over the years, it remains substantial, with the Asian giant exporting nearly $440 billion worth of goods to the US in 2024. On the flip side, China is also a vital export market for American goods, particularly agricultural products like soybeans and pork, as well as high-tech goods. Given the deeply intertwined trade relationship between the two countries, the ongoing tariff war has turned into a contest of "who can outlast the other," Chong says. While some remain hopeful that both sides would eventually back down, Chong sees that as "wishful thinking" in light of the leadership styles of Trump and Xi. "Neither side wants to lose face. Both sides want to talk tough and act tough. So that creates a situation where there's less negotiation, less willingness to compromise, and more potential for escalation," he said. Whether a full decoupling of the two economies will occur depends on how long the tit-for-tat continues and whether both sides keep the escalation bilateral, according to Chong. He noted that some goods are also rerouted through third countries before reaching the US or China. Wang Guo-Chen, an economist specializing in China at the Chung-Hua Institution for Economic Research in Taipei, argues that the US and China have "already economically decoupled in practice as Chinese goods have been unable to enter the US market since Trump raised tariffs to 104%."

What's in China's toolkit? Since the latest round of the trade war began, China has resorted to retaliatory tariffs, export restrictions to the US, and a suspension of American agricultural imports. More recently, Beijing has rolled out additional ways to strike back. On April 11, China's National Film Administration announced plans to "moderately reduce" the release of Hollywood films in the Chinese market, citing that US films would likely see reduced popularity following the 145% tariff on Chinese imports. Meanwhile, China's Commerce Ministry pledges to assist "foreign trade companies facing export challenges by tapping into the vast domestic market" through trade-in programs and government initiatives. But this domestic pivot may bring unintended consequences, especially for foreign businesses operating in China, which could face increased competition from Chinese firms, said Dali Yang, a political scientist and sinologist at the University of Chicago. Beijing has also sought to diversify its trade channels in recent years, successfully shifting some production to Vietnam, other Southeast Asian nations, and Mexico. But that strategy is now running into new obstacles. "Part of the Trump effort is actually to stop or slow those efforts," Yang told DW, adding that these alternative markets also have limited capacity to absorb all the Chinese goods once destined for the US. "The simple fact is China operates on such a scale that if allowed, China can practically produce for the entire world," Yang said, highlighting the overcapacity issue that continues to weigh on China's trade relationships. Meanwhile, the US remains a more attractive trading partner for most countries. "Most countries trading with the US run surpluses. In contrast, many of China's trade partners, while benefiting from Chinese goods, typically run deficits." "Trading with China, therefore, may not always result in significant job creation in those countries, as the imbalance often favors China," Yang said.

Summary of the blog:

A trade deficit occurs when a country's imports exceed the amount of its exports. A tariff is a tax or duty imposed on the goods imported into a nation.

A trade war occurs when a government imposes punitive tariffs on another country, often in response to tariffs or protectionist trade policies raised by the other nation. Trade wars are a side effect of protectionist policies and are controversial. Advocates say that trade wars protect national interests and provide advantages to domestic businesses. Critics of trade wars claim that they ultimately hurt local companies, consumers, and the economy.

Timeline 2018 to 2024: The year 2018: President Trump threatened to pull the U.S. out of the World Trade Organization (WTO), an impartial, international entity that regulates and arbitrates trade among the over 160 countries that belong to it. In early 2018, President Trump stepped up his efforts, particularly against China. He threatened a substantial fine over alleged intellectual property (IP) theft and significant tariffs. The Chinese retaliated with a 25% tax on over 100 U.S. products. Throughout 2018, the two nations continued to threaten each other, releasing lists of proposed tariffs on various goods. Although China responded with tariffs of its own, the American duties did have an impact on the Chinese economy, hurting manufacturers and causing a slowdown. The year 2019: In December, each nation agreed to halt the imposition of any new taxes. The tariff war cease-fire continued into 2019. In the spring, China and the U.S. seemed on the verge of a trade agreement. At the beginning of May, Chinese officials took a new hard line in negotiations, refusing to make changes in their company-subsidizing laws and insisting on the lifting of the current tariffs. Angered by this apparent backtracking, the President doubled down, announcing on May 5, 2019, that he was going to increase tariffs, as of May 10, from 10% to 25% on $200 billion worth of Chinese imports.5 He may have felt emboldened by the fact that the U.S. trade deficit with China had fallen to its lowest level since 2014. China halted all imports of farm products by state-owned firms in retaliation. The Asian nation's central bank also weakened the yuan above the seven per dollar reference rate for the first time in over a decade, leading to concerns about a currency war. The year 2020: Perhaps realizing that this was mutually destructive, the U.S. and China agreed to a trade deal that was signed on Jan. 15, 2020.11 The year 2024: However, the U.S. continued to raise trade barriers. In 2024, President Biden raised the tariffs on electric vehicles to 100%, with solar cells and semiconductors facing tariffs of 50%.12 Other technology products also faced sharp tariff increases, causing China to pledge further retaliation.

On April 2, 2025, Trump unveiled sweeping duties on all US trading partners, unleashing an all-out assault on global trade and sending shockwaves throughout the world economy.

Trump takes the trade war with China to the next level: The levies were set to commence on April 9. But hours after they came into effect, the US president announced a 90-day tariff pause for over 75 countries that were seeking trade negotiations with Washington. Trump, however, excluded China from the pause and instead ratcheted up duties on Chinese imports as punishment for Beijing's initial move to retaliate. Accusing China of showing a "lack of respect," the US leader raised the tariffs to 125%, bringing total duties on Chinese imports to 145%, including a 20% levy previously imposed over Beijing's alleged failure to curb fentanyl exports to the US. Beijing criticized Trump's actions as "bullying" and vowed to fight "to the end" with counteractions. If Washington continues to impose additional tariffs on Chinese goods, "China will ignore it," the nation's Commerce Ministry stated on Friday, pointing out that US goods would then no longer make economic sense for importers. As tit-for-tat tariffs escalate between Washington and Beijing, the cracks between the world's two biggest economies are growing deeper. Trump is expected to intensify the trade confrontations that defined his first administration, potentially escalating tariffs and sanctioning Chinese companies to achieve greater economic self-sufficiency. However, his focus on America’s immediate interests may leave little room for long-term strategic alliances, making his policy more difficult to predict. As Trump looks to navigate his second term amid a tumultuous political backdrop, China will need to adapt quickly to a US president who is more focused on leveraging short-term victories than on pursuing traditional diplomatic strategies.

Disclaimer: The best efforts are made to provide authentic and updated information on the subject.  This blog is prepared from the data compiled and summarized from various websites, as mentioned in the blog. The information given in this blog is only for educational purposes. It is not intended to serve as a legal document. This blog is not AI-generated, instead, it is manually written. Therefore, I do not take any responsibility (legal or otherwise) for its typographical errors, editing errors, correctness, completeness, consequences, etc. Before following anything from this blog, it is strongly requested to cross-check from trusted and authorized websites and/or reliable sources.

https://en.wikipedia.org https://www.investopedia.com https://www.dw.com https://www.china-briefing.com https://www.piie.com

Last lines: My personal opinion: $             Every nation wants to gain more benefits, more popularity, and mighty strength. $$           However, import and export are mostly essential for each country. $$$         Import and export require mutual consent and mutual benefits. $$$         It is required to compromise to some extent. $$$$       Bad practices destroy the relationships among the countries. $$$$$     Less import and more export is possible only with self-sufficiency. $$$$$$ The quality of domestic products must be at par or better than the others. $$$$$$$ Hope the countries will make a little compromise and have better respect for each other. ***The end  ***