President Donald Trump is set to impose an astounding 104% in levies across all Chinese imports on Wednesday, White House Press Secretary Karoline Leavitt announced on Tuesday.
This comes on top of Chinese tariffs that were in place prior to Trump’s second term.
China was already set to see tariffs increase by 34% on Wednesday as part of Trump’s “reciprocal” tariffs package. But the president tacked on another 50% after Beijing didn’t back off its promise to impose 34% retaliatory tariffs on US goods by noon Tuesday, adding an additional 84% in duties.
‘‘Additional 50% tariffs ‘a mistake upon a mistake’”
Earlier Tuesday, China’s Commerce Ministry said it “firmly opposes” the additional 50% tariffs on Chinese imports, calling it “a mistake upon a mistake.” The ministry vowed to escalate its retaliation on US exports.
US stocks, which soared Tuesday morning, began moving lower off Leavitt’s comments. The Nasdaq and S&P 500 dipped into negative territory, while the Dow remained positive around 2:30 p.m. ET.
“Countries like China, who have chosen to retaliate and try to double down on their mistreatment of American workers, are making a mistake,” Leavitt told reporters on Tuesday. “President Trump has a spine of steel, and he will not break.”
“The Chinese want to make a deal, they just don’t know how to do it,” she added. She declined to share what, if any, terms Trump would consider to lower tariffs on China.
Trump initially imposed a 10% tariff on all Chinese goods in February, with no exceptions, tying it to the country’s alleged role in aiding illegal immigration and getting fentanyl into the US. Last month, he doubled those rates.
China was America’s second largest source of imports last year, shipping a total of $439 billion worth of goods to the US, while the US exported $144 billion worth of goods to China. The mutual tariffs threaten to hurt domestic industries and are poised to result in layoffs.
China “wants to make a deal”
Just like Leavitt said, Trump also said China “wants to make a deal” as his deadline for steep new tariffs draws near, but adds that Beijing has not yet reached out to the United States.
“They don’t know how to get it started. We are waiting for their call. It will happen!” Trump wrote on Truth Social.
Trump also held what he described as a “great call” with South Korea’s acting president, Han Duck-soo.
“We have the confines and probability of a great DEAL for both countries.”
”China making a big mistake, playing with a ‘losing hand’”
Meanwhile, U.S. Treasury Secretary Scott Bessent says China is playing with a “losing hand” in the escalating tariff back-and-forth between the two countries.
“I think it was a big mistake, this Chinese escalation, because they’re playing with a pair of twos,” Bessent said on “Squawk Box.”
Other countries appear to be more willing to negotiate than China, he said.
“If they come to the table with solid proposals, I think we can end up with some good deals,” he said, “and part of the calculus of that may be that some part of the tariffs stay on.”
Last night, members of the administration discussed which countries to prioritize for trade talks, he added.
Dozens of countries set to see higher tariffs soon, too
Dozens of other countries as well as the European Union also face a midnight deadline for new tariff rates. Those rates, which Trump laid out last week, range from 11% to 50%.
Leavitt told reporters that despite several conversations with world leaders aiming to negotiate lower tariff rates, Trump has little appetite to delay his plans.
Having spoken with Trump earlier on Tuesday, Leavitt said, “He expects that these tariffs are going to go into effect.”
At the same time, she said Trump instructed his trade team to make “tailor-made” deals with countries that want to negotiate.
Pressed further on whether the president had any timeline or deadline for the trade deals, Leavitt again reiterated that they won’t be “off-the-rack deals.”
However, Beijing vowed to “fight to the end” after Trump threatened to hit Chinese exports with additional 50% tariffs if the country proceeds with plans to retaliate against his initial vow to impose tariffs of 34% on its products. That would come on top of the existing 20% levy and take the total tariff on Chinese imports to 104%.
The White House confirmed that the higher US tariffs on China would, indeed, be imposed from Wednesday. “President Trump has a spine of steel and he will not break,” press secretary Karoline Leavitt said. “And America will not break under his leadership.”
Musk tells Trump to reverse tariffs
The billionaire Trump adviser Elon Musk has also reportedly asked the president to reverse course and the conservative businessmen Leonard Leo and Charles Koch have filed a lawsuit against the “illegal” tariffs.
The latest tariffs are higher than the 10% flat rate imposed on all global imports to the US on Friday last week and are tailored to specific countries based on a formula that has been criticised by economists that divides trade in goods deficit by twice the total value of imports.
After days of turmoil since they were first unveiled last week, global markets recovered some ground on Tuesday as senior US officials attempted to reassure investors that the new tariffs – including rates of 20% on the European Union, 26% on India and 49% on Cambodia – could be temporary.
The FTSE 100 rallied by 2.7% in London, recovering some of the losses it has endured since Trump’s announcement – on what was dubbed “liberation day” by his aides – last week. On Wall Street, the benchmark S&P 500 gained 2.8% as the Dow Jones industrial average rose 2.9%.
They tracked Asian markets higher. The Nikkei 225 rallied 6% in Tokyo. The Hang Seng Index rose 1.5% in Hong Kong.
‘New tariffs are at ‘maximum’ levels”
Scott Bessent, the US treasury secretary, has insisted the new tariffs are at “maximum” levels, and expressed confidence that negotiations will bring them down.
“I think you are going to see some very large countries with large trade deficits [with the US] come forward very quickly,” he told CNBC, the financial news network, on Tuesday. “If they come to the table with solid proposals, I think we can end up with some good deals.”
Trump was asked on Monday whether the tariffs set the stage for negotiations with countries, or were permanent. “Well, it can both be true,” he told reporters. “There can be permanent tariffs, and there can also be negotiations.”
But he again raised the prospect of agreements with countries on Tuesday, trailing a potential deal with South Korea.
“Their top TEAM is on a plane heading to the US, and things are looking good,” Trump wrote on his Truth Social platform. “We are likewise dealing with many other countries, all of whom want to make a deal with the United States.”
The president added: “‘ONE STOP SHOPPING’ is a beautiful and efficient process!!! China also wants to make a deal, badly, but they don’t know how to get it started. We are waiting for their call. It will happen!”
‘‘UK markets functioning effectively, banking system resilient”
Rachel Reeves, the UK chancellor, sought to ease concerns about market volatility, telling parliament she had spoken to Andrew Bailey, the governor of the Bank of England, who confirmed “markets are functioning effectively and that our banking system is resilient”.
A trade war “is in nobody’s interest”, Reeves argued, confirming that the UK was seeking to negotiate a new deal with the US. Trump has imposed a 10% tariff on UK exports, in line with the minimum benchmark introduced at the weekend.
She declined to back Liberal Democrat calls for the government to launch a “buy British” campaign. “In terms of buying British, I think everyone will make their own decisions,” Reeves said. “What we don’t want to see is a trade war, with Britain becoming inward-looking.”
China adopted an altogether different stance. In a scathing editorial, the official state news outlet Xinhua accused the US president of “naked extortion”.
“Utterly absurd is the underlying logic of the United States: ‘I can hit you at my will, and you must not respond. Instead, you must surrender unconditionally,’” it said. “This is not diplomacy. It is blunt coercion dressed up as policy.”
On social media a 1987 speech by then US president Ronald Reagan posted by China’s foreign ministry has been widely shared.
The video clip, in which Reagan criticises the use of tariffs as leading to retaliation and ultimately hurting the US economy, “has a new meaning in 2025”, China’s the Paper said.
Bessent argued on Tuesday that China was making a “big mistake” by daring to retaliate. “They’re playing with a pair of twos,” he claimed on CNBC.
“What do we lose by the Chinese raising tariffs on us? We export one-fifth to them of what they export to us, so that is a losing hand for them.”
