Trump Escalates Trade War with China as Tariffs Hit Historic Highs
President Donald Trump told TIME Magazine he recently spoke with Chinese President Xi Jinping about the escalating trade conflict between the U.S. and China—just as both nations ramp up tariffs to historic levels.
According to the interview published Friday, Trump said he expects the two countries to eventually strike a deal. “There’s a number at which they will feel comfortable,” Trump said. “But you can’t let them make a trillion dollars on us.”
The trade standoff, which began under Trump’s first term and has since intensified, now features U.S. tariffs on Chinese goods reaching as high as 145%, with China retaliating with up to 125% tariffs on U.S. imports. Markets have been rattled, and fears of a global recession are growing.
China Warns of ‘Worst-Case Scenario’
In response, China’s Ministry of Commerce issued a statement Friday urging the country to prepare for a “worst-case scenario,” warning of continued risks in the escalating dispute. Chinese officials called for increased political awareness and stronger risk management as tensions rise.
A Viral Trade Twist: The White House Dress Debate
Amid the tariff drama, a Chinese diplomat took a jab at the U.S. from a different angle—fashion. On X (formerly Twitter), the Chinese Consul General in Indonesia pointed out that White House Press Secretary Karoline Leavitt was allegedly wearing a China-made dress during a January 31 briefing in which she announced new tariffs on China, Canada, and Mexico.
“Accusing China is business. Buying China is life,” the diplomat wrote, claiming the lace dress was recognized as a Chinese-made product from the brand Self-Portrait, which manufactures in China.
The irony of criticizing Chinese trade practices while wearing a Chinese-made garment quickly went viral, fueling further debate just as the U.S. hiked tariffs on Chinese goods to 245%—a massive escalation in a trade war that shows no signs of slowing down.
Direct-to-Consumer Chinese Sellers Bypass U.S. Tariffs
Meanwhile, Chinese sellers are adapting. On platforms like TikTok, factory-linked influencers are directly marketing goods to U.S. consumers, often claiming to sell OEM (original equipment manufacturer) products at factory prices. While many of these claims remain unverified, some U.S. brands have warned about counterfeit risks.
Despite American efforts to reduce reliance on Chinese manufacturing, the global supply chain—especially in fashion and electronics—remains deeply intertwined with China.
White House: China Facing Up to 245% in Tariffs
The White House announced Tuesday that tariffs on Chinese goods could now reach up to 245%, citing national security concerns and Beijing’s refusal to negotiate. A new executive order also launched an investigation into U.S. imports of critical resources.
While over 75 other countries are in trade talks with the U.S. and have been spared from the latest tariffs, China was singled out for retaliation instead of cooperation.
China Strikes Back: 84% Tariff on U.S. Goods
In response, China increased tariffs on American goods to 84%, effective April 10. This brings China’s cumulative tariffs on U.S. imports to 104% for the year, according to Chinese officials.
Beijing also placed 12 U.S. entities on its export control list and added six firms to its “unreliable entity list”, targeting businesses deemed a national security threat.
The Bigger Picture
What began as a push to level the playing field has escalated into a full-blown trade war with far-reaching economic consequences. Trump’s latest wave of tariffs officially took effect this month, impacting roughly 60 trade partners—especially China, which he has repeatedly called the “worst offender.”
Despite efforts by both the Trump and Biden administrations to untangle the U.S. from Chinese manufacturing, the reality remains: global commerce is still tightly interwoven—even in the halls of political power.
Trump Defends Explosive Tariffs as China Vows to ‘Fight Till the End’
The global market took a hit last week after President Donald Trump’s latest round of tariffs triggered a loss of trillions of dollars worldwide, sparking concern among American consumers and economists. Fears of inflation and a potential recession are now front and center.
Trump: Tariffs May Be “Explosive,” But They’re Working
At a Republican Party dinner in Washington on Tuesday, Trump addressed the market fallout, acknowledging the economic turbulence as “somewhat explosive.” Still, he defended his approach, pointing to the surge in revenue: “It’s pouring in,” he said.
Trump admitted that a 104% tariff on Chinese goods “sounds ridiculous,” but claimed Beijing was eager to avoid further penalties and strike a deal. “They’re dying to make a deal,” he said, adding, “I know what the hell I’m doing.”
Originally, Trump imposed a 20% tariff on Chinese imports, which was increased by another 34% in response to Beijing’s retaliation. After threats of an even steeper hike, China accused the U.S. of economic bullying—but Trump held firm, claiming national pride was delaying Chinese concessions.
Skepticism Mounts Over Trump’s Strategy
Analysts are split over the effectiveness of Trump’s tariff strategy. Some warn the U.S. may be “overplaying its hand,” with Chinese officials warning of “firm and forceful measures” in response.
Chinese Foreign Ministry spokesman Lin Jian blasted the U.S. tariffs as “abusive” and called for negotiations based on mutual respect and reciprocity. In an official white paper, Beijing reiterated a willingness to resolve trade differences—so long as the U.S. eases its aggressive stance.
Tariffs Shake Global Supply Chains—Including Shein
The pressure is reaching beyond Washington and Beijing. According to Bloomberg, China’s Ministry of Commerce has reportedly urged fast-fashion giant Shein to reconsider plans to shift production out of China.
Shein had been exploring new supply chain options in countries like Vietnam, but those plans may now be paused. The Chinese government is doubling down on efforts to preserve its role as a global manufacturing hub amid fears of production flight.
The White House confirmed that as of April 9, tariffs on Chinese goods are set to climb to 104%, following Trump’s warning of another potential 50% hike if China didn’t back off. Meanwhile, smaller U.S. businesses are bracing for impact.
Small Businesses and Consumers Brace for Impact
A forthcoming report by PYMNTS Intelligence warns that small- and mid-sized businesses (SMBs) could face “acute pain” if tariffs persist. Many rely on tight margins and daily sales to survive—7% say they may not last two more years under current conditions.
Consumers aren’t immune either. As platforms like Shein and Temu face higher costs, retail prices are expected to rise, hitting American wallets hard—especially for those who’ve turned to these platforms as low-cost alternatives to Amazon.
Apple Eyes India as an Alternative
Meanwhile, Apple is reportedly increasing iPhone production in India to avoid the brunt of U.S. tariffs. Products from India face a 26% tariff, far less than the 54% rate applied to Chinese imports, giving companies an incentive to diversify their manufacturing footprint.
China: “We Will Fight to the End”
In a statement carried by state-run Xinhua, China’s Commerce Ministry condemned Trump’s latest threat of an additional 50% tariff as “unilateral bullying” and vowed to “fight till the end.”
The showdown shows no sign of slowing. With economic consequences already unfolding, both sides are digging in deeper—testing how far either is willing to go in the name of economic dominance.
China Accuses U.S. of ‘Blackmail’ as Trump Threatens Even Steeper Tariffs
China has issued a fierce rebuke to former President Donald Trump’s escalating trade threats, vowing to “fight till the end” if the U.S. continues down what it called a “wrong path.” In a sharp statement, Beijing accused Washington of “blackmail” and defended its retaliatory measures as necessary to protect national sovereignty and global trade stability.
The warning came after Trump took to Truth Social on Monday to propose yet another round of steep tariffs—not just against China but also against any country that dares retaliate. The move follows a 34% tariff increase last week, to which China responded in kind.
Markets Slide, Crypto Crashes as Trade War Escalates
The financial fallout has been swift and severe. More than $10 trillion has been erased from global equity markets, while Bitcoin fell below $75,000 for the first time in months. Alternative cryptocurrencies have plummeted more than 15%, reflecting investor panic amid growing instability.
JPMorgan has raised the odds of a global recession to 60% by the end of the year—citing prolonged tariff battles, shaken investor confidence, and slowing global trade as major risk factors.
Trump: Tariffs Are the Cure, Not the Problem
Despite the turbulence, Trump has doubled down. He defended the tariffs—now ranging between 10% and 50% across multiple countries—as a strategic tool to fix what he called a rigged system. “Sometimes you have to take medicine to fix something,” he said, arguing the short-term pain will lead to a manufacturing revival and reduced U.S. trade deficits.
Trump’s strategy has sparked alarm among economists and world leaders, but he insists the tariffs are working. “We’re bringing jobs back, and these countries know they can’t keep ripping us off,” he told supporters.
Beijing Holds Firm: ‘We Will Never Accept Economic Intimidation’
China, however, shows no sign of backing down. “The U.S.’s so-called ‘reciprocal tariffs’ are baseless and unjust,” a Commerce Ministry spokesperson said Tuesday. “China will never accept economic intimidation.”
With rhetoric intensifying and neither side appearing willing to budge, fears are mounting that the conflict could spiral into a prolonged economic standoff—with consequences not just for the U.S. and China, but for global growth, trade, and financial stability.
Tariffs 101: Why They Matter Now More Than Ever
Never thought you’d need to know what a tariff is? You’re not alone. Once the domain of economics textbooks and trade negotiators, tariffs are now affecting everything from your grocery bill to your crypto wallet.
At their core, tariffs are taxes imposed by governments on imported goods. The goal? To make foreign products more expensive, boosting demand for domestic alternatives. In theory, they protect local industries and jobs. In practice, they often lead to higher prices for consumers and strained relationships with trade partners.
Trump’s 2025 tariff campaign has turned the concept into a household topic, especially as American shoppers, investors, and business owners begin to feel the pinch. Whether it’s the price of a smartphone, the cost of leggings on Shein, or the fate of your 401(k), tariffs are no longer just about trade—they’re about your bottom line.
