Beijing signals tariff ceiling as Trump targets electronics in next wave of duties

On Friday, April 11, China raised tariffs on US imports to 125 percent, intensifying the trade war after US President Donald Trump earlier in the week increased tariffs on Chinese goods to 145 percent, according to Reuters.  

The Chinese finance ministry condemned Trump’s tariff hikes as “completely unilateral bullying and coercion.”  

While Beijing said it would not match any future tariff increases, it warned that US goods were already facing “no market acceptance” in China, as reported by The Guardian. 

Chinese President Xi Jinping addressed the issue on Monday, April 14, during a meeting with Spanish Prime Minister Pedro Sanchez, calling for China and the European Union to “jointly oppose unilateral acts of bullying,” according to Reuters. 

On Sunday, Trump stated on Truth Social that there were “no tariff exceptions,” clarifying that smartphones and laptops, though temporarily removed from the reciprocal tariff list, still fall under the 20 percent fentanyl tariff.  

He also announced a national security trade investigation targeting semiconductors and electronics supply chains, warning that “no one’s getting off the hook,” as reported by The Guardian. 

Markets reel as tariffs drive inflation fears and investor uncertainty 

Financial markets have reacted sharply to the tariff battle. The benchmark 10-year US Treasury yield saw its largest weekly increase since 2001, while gold hit a record high and the US dollar slumped, according to Reuters.  

The US$29tn Treasury market experienced a selloff following Trump’s tariff announcement. 

The University of Michigan’s Consumer Sentiment Index dropped to 50.8 in April from 57.0 in March, with 12-month inflation expectations rising to 6.7 percent—the highest level since 1981.

Bill Adams, chief economist at Comerica Bank, told Reuters that “tarifflation will be much more important for the outlook than backward-looking data,” warning that continued tariffs could raise inflation in the coming months. 

US Democratic Senator Elizabeth Warren called the latest revisions “chaos and corruption,” speaking on ABC’s “This Week,” as reported by The Guardian. 

Xi initiates ‘wartime footing’ strategy and global outreach 

Following Trump’s “Liberation Day” tariffs announced on April 2, China placed civilian officials in Beijing on a “wartime footing,” according to Reuters.  

Officials in the foreign affairs and commerce ministries were told to cancel vacation plans and remain on call.  

China increased staffing in US-related departments and began diplomatic outreach to other countries targeted by the tariffs. 

Four people familiar with the effort told Reuters that Beijing sent letters urging foreign governments to support multilateral trade and reject US “unilateralism.”  

G20 members were approached with proposals for joint declarations. However, an EU diplomat said the messaging did not address concerns about China’s industrial policies and subsidies. 

A spokesperson for the Chinese embassy in Washington told Reuters that while China “did not want to fight trade wars,” it “is not scared of them.” 

White House defends strategy; tariffs seen as part of broader dealmaking 

The White House said more than 75 countries have sought trade negotiations with the US since Trump’s announcements. 

Aboard Air Force One, Trump said his 10 percent tariffs were “a floor” and predicted the dollar “will go way up” once the strategy is understood. 

Trump also maintained that foreign exporters pay the tariffs, saying, “We pretty much can do what we want to do... or they can choose to pay it."

However, the same report noted that tariffs are paid by the importer, who often passes the costs onto consumers. 

China expands domestic economic focus, invokes nationalist sentiment 

China has shifted its focus to domestic resilience. Households have been urged to increase spending, and state media circulated an April 7 People’s Daily editorial discouraging panic. On social media, users shared a 1953 speech by Mao Zedong saying, “We’ll never yield.” 

One Chinese official told Reuters that the swift tariff response was similar to COVID-era decision-making, bypassing traditional bureaucratic approvals.  

China has also placed restrictions on American films, service trade, and citizen travel to the US.

Electronics exempted for now but new tariffs loom 

On Friday, the White House temporarily lifted tariffs on electronics such as Apple and Nvidia products, which led to gains in their stock prices, according to The Guardian.  

But US Commerce Secretary Howard Lutnick clarified on Sunday that these items would soon face new national security tariffs, likely within one to two months.  

“These are things that are national security, that we need to be made in America,” Lutnick said on ABC.

Zhang Li, president of the China Center for Information Industry Development, told China Daily that the temporary exemption shows how reliant US tech firms are on Chinese manufacturing, as cited by The Guardian. 

Diplomatic channels falter amid growing isolation 

Reuters reported that Chinese Foreign Minister Wang Yi failed to secure meetings with US officials Marco Rubio and Mike Waltz during a February visit to New York.  

Similarly, Ambassador Xie Feng’s attempt to connect with Elon Musk before the election did not succeed.

A Trump administration official told Reuters that while the US wants working-level contact with China, it would not engage “for the sake of engagement.”  

Trump has expressed willingness to meet Xi, but US officials said China has consistently declined to request a call. 

China’s playbook includes tariffs, restrictions and global positioning 

Drawing on its experience from Trump’s first term, China deployed a strategy involving retaliatory tariffs, restrictions on 60 US firms, and rare earth export limits.

Political blogger Ren Yi, with nearly 2 million followers on Weibo, argued in an April 8 post that full-scale tariffs may not be necessary.  

He proposed selective countermeasures like halting fentanyl cooperation and curbing imports of agricultural products and films.

China’s finance ministry said Friday it would not match further US tariff increases, branding Washington’s strategy a “joke."

Estimated US consumer impact of tariff hikes 

According to Reuters, Trump’s sweeping tariffs are expected to increase consumer prices in the following sectors: 

•  Medical diagnostic equipment: +10 percent 

• Computer parts and toys & video games: +30 percent  

These impacts reflect the broader effects of the deepening US-China trade standoff.