LAST UPDATE | 11 Apr 2025

CHINA HAS ANNOUNCED countermeasures on the United States and is raising tariffs on US goods from 84% to 125% starting on Saturday.

The US and China have escalated a trade war by raising tariffs even as US President Donald Trump hit a pause on tariffs for other countries.

Trump’s universal tariffs on China total 145%.

When he announced on Wednesday that China faced 125% tariffs, he did not include a 20% tariff on China tied to its role in fentanyl production.

“The US alternately raising abnormally high tariffs on China has become a numbers game, which has no practical economic significance, and will become a joke in the history of the world economy,” a commerce ministry spokesman said in a statement announcing the countermeasure.

“However, if the US insists on continuing to substantially infringe on China’s interests, China will resolutely counter and fight to the end.”

The spokesperson added that the “US should bear full responsibility for this.

“Washington’s levies “(caused) the current world economy, global markets and multilateral trading systems to suffer serious shocks and severe turbulence.”

China’s Commerce Ministry said it was filing another legal case with the World Trade Organisation on the raising of US tariffs.

Meanwhile, China has claimed that Trump’s decision to freeze tariffs on other countries came partly after “pressure from China”.

“Under pressure from China and other parties, the United States has temporarily suspended the imposition of high reciprocal tariffs on some trading partners,” a Commerce Ministry spokesperson said.

“This is only a small symbolic step.”

Elsewhere, the EU’s top officials and China’s leaders are due to hold their next summit marking 50 years of ties in China in July, a spokesperson for the European Council said today.

“We are coordinating with China to set a date for the meeting, which is expected to take place in China in the second half of July,” said the official at the council, the body representing the European Union’s 27 countries.

Spain

It comes as Spain’s prime minister Pedro Sánchez is visiting China today for high-level talks as his government seeks to deepen economic ties with the Asian superpower.

Sánchez, on his third visit to China in two years, met with President Xi Jinping this morning and is also expected to hold discussions with senior executives from leading Chinese companies, particularly those in the electric battery and renewable energy sectors.

Spanish Prime Minister Pedro Sanchez met with Chinese President Xi Jinping this morning. PA PA

The visit comes at a time of rising uncertainty for the global economy, sparked by US president Donald Trump’s erratic tariff policy.

Last week, Trump announced sweeping new tariffs, only to pause many of them days later.

For Spain, the stakes are high – government spokeswoman Pilar Alegría said the visit carries “special importance”, noting that as much as 80% of Spanish exports to the United States could be affected by the tariffs.

“Diversifying markets” is now a top priority, she said.

Sánchez echoed that sentiment while in Vietnam on Thursday, where he signed a series of commercial deals before heading to Beijing.

“A trade war favours no one. We all lose,” he said.

In a sign of Madrid’s shifting foreign policy stance, agriculture minister Luis Planas defended the decision to strengthen ties with China, stating: “Expanding the trade relations that we have with other countries, including a partner as important as China, does not go against anyone.”

“Everyone has to defend their own interests.”

Spain’s position on China has become noticeably more conciliatory than that of other EU nations.

Although it initially supported EU tariffs on Chinese-made electric vehicles last year, Spain later abstained from a vote on customs duties, suggesting a more nuanced approach.

Some US officials, however, were quick to criticise. Treasury secretary Scott Bessent warned earlier this week that countries leaning toward China would be “cutting their own throat”, arguing that Beijing would flood Europe with discounted goods it can no longer sell in the US.

Meanwhile, global markets continued to reel from Washington’s tariff policy.

In Asia, Japan’s Nikkei 225 plummeted 5.6% this morning before recovering slightly to a 4.7% loss by mid-session.

The Korean Kospi dropped 1.6%, while Australia’s S&P/ASX 200 shed 2.1%.

The yen surged against the dollar, which also slipped against the euro.

On Wall Street, yesterday saw a dramatic reversal of gains. The S&P 500 plunged 3.5%, following a 9.5% surge the day before. The Dow Jones fell over 1,000 points, and the Nasdaq dropped 4.3%.

Shares in Warner Bros. Discovery fell 12.5%, while Disney’s stock sank nearly 7%.

A spokesperson for China’s Film Administration said US films had become “less palatable” to Chinese audiences following “the wrong move by the US to wantonly implement tariffs on China”.

The European Union, for its part, said it would pause its own retaliatory measures for 90 days, leaving space for potential negotiations.

Yesterday’s swings also hit the bond market, which has historically played the role of enforcer against politicians and economic policies it deemed imprudent.

Additional reporting from PA