Beijing vows resolute response if Trump presses 100% tariffs
China on Sunday warned the United States that it would retaliate if President Donald Trump proceeds with his threat to impose 100% tariffs on Chinese imports. The warning comes as investors brace for another round of potential turmoil in the US-China trade relationship, a dynamic that has already unsettled stock markets and energy prices in recent weeks.
Beijing’s commerce ministry attributed the escalation to Washington’s decision to threaten sweeping tariffs and to introduce new controls on critical software. A statement carried by Xinhua News Agency emphasized that while China does not seek confrontation, it will defend its legitimate interests if the United States chooses the path of “wilful threats.” The ministry’s spokesman added that China does not fear the trade war, and made clear that “if the United States insists on going the wrong way, China will surely take resolute measures.”
The Trump administration’s latest position, announced on Friday, would impose additional tariffs on Chinese exports by November 1 and expand controls on high-tech goods. US officials argued that these steps were necessary in response to what they described as China’s “hostile” moves in restricting critical materials and technologies essential to American industry, including certain rare earth elements used in manufacturing and defense supply chains.
China’s response to the tariff threat has emphasized that its export controls on rare earths are not bans and that uses compliant with civil purposes will gain approvals. The ministry stressed that the measures are targeted and legitimate, framing them as a standard component of its broader effort to safeguard national interests amid a volatile global trading environment.
The broader context is a fragile trade relationship that has endured years of negotiation, tariff threats, and periodic flare-ups. After Trump’s remarks, major stock indices in the United States fell sharply, with the tech-heavy Nasdaq and broader markets reacting to the possibility of renewed price pressures on Chinese goods and potential disruptions to supply chains. By contrast, markets in Asia and Europe attempted to assess the likelihood and timing of any retaliation or concessions from Beijing.
Market reaction and policy calculus
Analysts described the situation as a test of whether Trump’s tariff rhetoric will translate into concrete measures. While some investors suspect an escalation could be tempered by strategic calculations from both sides, others warned that even the threat of 100% tariffs could have lasting economic repercussions, including higher costs for American consumers and reduced access to Chinese technology components.
Experts note that the volatility is not merely about tariffs itself but about the broader risk environment for global trade policy. The United States has argued that its approach is aimed at pressuring China to change unfair practices, while China has framed any significant tariff response as a legitimate defense against coercive economic measures from a rival power.
Given the interconnected nature of global supply chains, any move towards 100% tariffs would likely reverberate across multiple sectors, including manufacturing, technology, and energy. Investors are watching closely to gauge whether Beijing will retaliate with symmetrical tariffs, targeted restrictions, or other policy instruments designed to protect Chinese industries without triggering a full-blown trade war escalation.
What to watch next
Key questions include whether Washington will alter its stance ahead of November 1, how Beijing will calibrate its response, and what steps both sides might take to de-escalate tensions. In the near term, traders will scrutinize policy signals from both capitals, upcoming economic data, and any new export controls that could indicate a shift in either country’s strategic priorities.
As markets await clarity, the central takeaway remains: the risk of a renewed and intensified US-China trade clash persists, with both sides signaling readiness to defend their economic interests even as they seek avenues for negotiation and potential compromise.
