China warns Trump on tariffs, threatens retaliation on supply chain deals
China issued a warning to the Trump administration on Tuesday, cautioning against rekindling trade tensions by reimposing tariffs on Chinese goods starting next month. The nation also threatened to retaliate against countries that engage in deals with the United States to exclude China from their supply chains.
In June, Washington and Beijing reached a trade framework that established a fragile truce. However, the details of the agreement remain unclear, leaving traders and investors on both sides closely monitoring the situation to see if it will lead to a lasting detente or unravel.
President Donald Trump recently notified trade partners of significantly higher US tariffs starting August 1, after delaying most of the April duties to allow countries time to negotiate deals with the US. China, which initially faced tariffs exceeding 100%, has until August 12 to reach an agreement with the White House to prevent additional import restrictions.
The People’s Daily emphasized the importance of dialogue and cooperation to address the current trade tensions between China and the US. The article, signed by “Zhong Sheng” or “Voice of China,” reiterated Beijing’s stance that Trump’s tariffs constitute bullying.
Should Trump adhere to the “final deadline” mentioned in the commentary, it could lead to another round of tariff wars. The average US tariff on Chinese exports currently stands at 51.1%, while China’s average duty on US goods is 32.6%.
The Peterson Institute for International Economics reported that both countries have tariffs covering all their trade, with the US imposing higher tariffs on Chinese exports.
The People’s Daily also criticized regional economies considering tariff reduction deals with the US that exclude China from their supply chains. China firmly opposes any agreement that sacrifices its interests for tariff concessions and vows to protect its legitimate interests if such situations arise.
