China Hits Back with 15% Tariff Amid U.S. Trade Tensions

Escalating the U.S.-China Trade War with Tariffs on Key Imports / AFP

The trade war between the United States and China has intensified as both nations implement new tariffs, signaling a deepening economic conflict between the world’s two largest economies. On February 4, 2025 (local time), the U.S. imposed a 10% tariff on Chinese imports as planned, triggering an immediate response from Beijing. In retaliation, China announced that starting February 10, it will impose tariffs ranging from 10% to 15% on a selection of American goods, while also introducing export restrictions on critical minerals essential for global industries.

The Trump administration’s move to impose the 10% tariff followed months of deteriorating trade relations. Despite brief optimism over a potential last-minute agreement, no negotiations occurred, and reports confirmed that President Trump has no immediate plans to discuss the matter with Chinese President Xi Jinping. Beijing, however, wasted no time in responding. China's State Council Tariff Commission announced tariffs on 80 U.S. goods, including coal, liquefied natural gas (LNG), and crude oil, while also enacting export controls on key minerals like tungsten and molybdenum, crucial for semiconductor manufacturing.

China’s Retaliation Targets Energy and Agriculture Sectors

China’s retaliatory tariffs specifically target sectors critical to the U.S. economy. Products subject to a 15% tariff include coal, lignite, and LNG, while a 10% tariff will be applied to crude oil, large vehicles, and agricultural machinery such as tractors and harvesters. This carefully chosen list aims to impact industries vital to U.S. exports. For example, American agricultural machinery, with annual exports to China valued at $219 million, faces new challenges in accessing the Chinese market. While Beijing excluded sensitive items like soybeans and nuclear-related equipment from its tariff list, the strategic selection underscores its intent to escalate pressure without exhausting its leverage.

China also announced immediate restrictions on exporting critical minerals, including tungsten, tellurium, and molybdenum—materials indispensable for the semiconductor industry and advanced manufacturing. Companies wishing to export these materials must now obtain pre-approval under China’s export control laws, a move that could disrupt global supply chains and weaken U.S. technological industries in the short term.

Economic Fallout and the Risk of Escalation

The escalating trade war has far-reaching implications for global markets. In 2023, China’s imports from the U.S. totaled $165 billion, with energy products like coal and oil leading the list. By targeting these sectors, China not only impacts the U.S. economy but also sends a message about its capacity for precise economic retaliation. Analysts suggest the new tariffs and export restrictions could significantly affect American industries reliant on Chinese minerals, leading to increased production costs and supply chain disruptions.

Despite the current standoff, some experts believe there remains room for negotiation before China’s retaliatory tariffs take effect on February 10. While President Trump initially hinted at possible talks with President Xi, these hopes have dimmed, with White House officials denying any immediate plans for such discussions.

Impact on U.S. Tech and Global Trade

China’s actions extend beyond tariffs. The government also launched an antitrust investigation into Google, citing alleged violations of Chinese competition laws. This move highlights Beijing’s readiness to target specific U.S. companies as part of its broader strategy in the trade war. By focusing on tech giants like Google, China signals that its countermeasures are not limited to tariffs but also involve regulatory pressure on American firms operating within its borders.

While the U.S.-Canada-Mexico trade negotiations appear to have temporarily averted additional tariffs, the U.S.-China conflict shows no signs of resolution. With China’s retaliation focusing on key U.S. industries and raw materials, the trade war could have long-lasting effects on global economic stability.

Strategic Calculations and Uncertain Prospects

China’s measured approach—excluding high-priority imports like soybeans and refraining from imposing broad financial penalties—suggests it is reserving stronger countermeasures for future negotiations. However, with no immediate resolution in sight and both sides digging in, the risk of prolonged economic harm grows. Analysts warn that continued escalation may lead to broader market instability, affecting businesses and consumers worldwide.

As the February 10 deadline for China’s tariffs approaches, the coming days will reveal whether either side is willing to compromise or if the trade war will further intensify. The stakes remain high, not only for the U.S. and China but also for the global economy, as the two superpowers continue their economic showdown.