China Hikes Levies to 125% on U.S. Goods, Holding Firm Against Trump

What Happened?

China hiked its levies to 125% on U.S. imports Friday, to keep its stance against President Donald Trump and his global measures surrounding tariffs.

President Trump's decision to single out the world's second-largest economy for higher duties was reportedly dismissed as 'a joke.'

A spokesperson for China’s Ministry of Commerce told reporters Friday, that the Trump administration’s approach was a 'numbers game which has no practical significance on economics.'

China’s statements come after the Trump administration imposed a minimum tariff of 145% on Chinese goods imported to the U.S.

Top leader, Xi Jinping, reportedly spoke publicly for the first time about tariffs since Washington and Beijing began going tick-for-tack with higher levies.

'There are no winners in a tariff war, and going against the world will only result in self-isolation,' he said, according to the New York Times.

Xi had met Friday with Spain's Prime Minister, Pedro Sánchez.

The European Union, which Spain is a member of, reportedly pursues more trade with China through a fair and reasonable global governance system.

But Sánchez said, 'Trade wars are not good, nobody wins. And this is clear, the world needs both China and the United States to talk.'

Why it Matters

The ongoing battle between the U.S. and China threatens to rip apart trade ties between the world’s two largest economies.

China has called out to other nations to form a united front after the U.S. imposed a 145% tax levy on Chinese goods.

According to reports, China is attempting to compel Washington to retreat despite the U.S. already receiving 'serious' trade deal offers with roughly 20 nations.

Trump authorized a 90-day pause and a substantially lowered reciprocal tariff for all other nations excluding China 'based on the lack of respect that China has shown to the world’s markets.'

More than 75 countries have called U.S. representatives to negotiate trade solutions with the Trump administration.

American and Chinese companies have reportedly grown dependent on each other over the years amid mutual commerce.

However, the strong displays of retaliation have forced these business allies to shift positions, which has caused market disruption globally.

The U.S. goods trade deficit in 2024 with China was $295.4 billion.

How it Affects You

Although Trump has pointed to recent market struggles as 'transition problems,' he still believes the country is doing well on its tariff policy.

'In the end, it’s going to be a beautiful thing,' Trump has stated.

Chinese officials say the U.S. escalation of tariffs is a mistake and have even accused the U.S. of 'blackmail.'

Trump has accused China of issuing retaliatory tariffs and for allowing a flow of synthetic drugs that have entered the U.S.

A resolution with China appears nowhere in sight.

Experts project that the back-and-forth tariff hikes have increased the likelihood of a 2025 recession.

During Trump's pursuit to rectify trade practices, there's concern additional levies will heavily affect everyday consumers and small business owners.