Where do US and China now stand on trade?

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BEIJING: US President Donald Trump has increased his trade war with China, which has increased import tariffs on Chinese goods by 125 %, even as duties on other countries have been temporarily suspended.

This increase was made just a few hours after Beijing unveiled the mutual measures in response to the first round of US tariffs.

AFP thinks how the growing trade war between the world’s two largest economies is going on – and how can it affect:

What steps have Trump have taken so far?

Trump said Wednesday that the United States would raise prices on Chinese imports by 125 %, citing “lack of respect” from Beijing.

The announcement came when after panic in the global markets, the solid president announced to stay on taxes for other countries for 90 days.

The new levy on China marks the latest Salvo in the Tight for Tate Trade War between two world superpowers.

On Wednesday, the previous round of US prices came into force, which led to 104 % duties on China.

Along with blanket levies, China is also under specific taxes on steel, aluminum and car imports.

What has China responded?

China has vowed to fight “by the end” and so far, Trump has unveiled mutual rates so far.

In response to 104 percent of the duties on Wednesday, Beijing said it would increase its taxes on US imports to 34 percent, which is effective from Thursday.

It also states that it has filed a complaint with the World Trade Organization (WTO), citing the Trump administration’s “bullying” tactic.

Until Thursday morning, China did not respond to the latest increase in 125 % of revenue.

But its retaliation has begun to take steps outside the economic sector, government departments have warned citizens with “dangers” that they are traveling to the United States or studying in some parts of the country.

And when Beijing has targeted the United States with a volcanic rhetoric, it has continued a “equal dialogue” request to resolve the trade period.

China had sent a “clear signal” that it would not back down, adding that the dispute was “an immediate and easy way,” said Zhui Zhang, chief economist, the chief economist of the PAN Point Asset Administration.

“The potential agreement is higher for a possible deal,” said JP Morgan’s chief Chinese economist Hiben Jhho.

Why is China so much risk of prices?

The trade between the world’s two largest economies is very broad.

According to Beijing’s customs data, Chinese goods sales to the United States last year are more than $ 500 billion – which is 16.4 % of the country’s exports.

According to the office of the US Trade Representative, China imported $ 143.5 billion worth of goods from the United States in 2024.

According to the US China Business Council, agricultural products, primarily basil and grain dominated. US exports to China also include oil and gas, pharmaceuticals and semiconductors.

According to the US Commerce Department’s Economic Analysis Bureau, Beijing has long pulled Trump’s IRE to reach $ 295.4 billion last year with a trade surplus with the United States.

Chinese leaders are reluctant to disrupt this stagnation, part of it because the country’s export economy is particularly sensitive to international trade.

The US duties also threaten to damage China’s critical economic recovery as it is struggling with the debt crisis in the property sector, and permanently low-consumption-a misery, Beijing, tried to slow down with extensive financial stimulus last year.

But a severe trade war will likely that China cannot withstand the hopes of strong economic growth this year, which reached a record high in 2024.

What will be the effect of US prices?

The WTO chief said Wednesday that the US -China tariff war could reduce the goods trade between the two countries by 80 %.

Nogozi Okonjo-Iela said that by making the two economic giants three percent of global trade, the conflict “could severely damage the global economic approach”.

Analysts expect Levy to take a significant contribution from China’s GDP, which will increase Beijing’s leadership by five percent this year.

According to the Patterson Institute of International Economics, China has the highest exports from electronics and machinery to textile and clothing.

Analysts have warned that because of the significant role of Chinese goods in the supply of US firms, prices can hurt US manufacturers and consumers.

“It is difficult to see both sides backing in the next few days,” said Paul Ashworth, the chief North American economist, the capital of the capital Economics.

But, he added, “The conversation will eventually take place, though a complete role of all additional revenue … is unlikely.”