Trump piles pressure on Xi with latest threat to raise tariffs
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The new tariffs on China come on top of a previous 10 per cent duty implemented earlier in February.
PHOTOS: AFP, REUTERS
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WASHINGTON – US President Donald Trump unveiled additional tariffs on Chinese imports, raising the risk of Beijing ramping up its retaliation and a spiralling of tensions between the world’s two largest economies.
Mr Trump said in a social media post on Feb 27 that China will be charged an additional 10 per cent tariff on March 4, citing continued drug flows from North American neighbours at what he called “very high and unacceptable levels” and China’s alleged role in its supply.
The new tariffs on China come on top of a previous 10 per cent duty
Beijing’s response to the first round of tariffs has been measured but strategic, imposing levies on select US products to minimise damage to its own economy while signalling options for more significant countermeasures if needed.
As tensions rise, Chinese President Xi Jinping has called on his top officials to stay composed.
Notably, China’s major state media outlets, including Xinhua News Agency and People’s Daily, did not report on the US leader’s remarks as at the morning of Feb 28.
Bloomberg economist Maeva Cousin said the shock of the existing and expected tariffs on the Chinese economy “should be manageable”, citing the small share of its value added – just more than 2 per cent – tied to US exports.
“In the medium term, it is also likely that China will find new markets for its exports – although this may be met with resistance from partners in the rest of the world, already concerned about Chinese overcapacity in some sectors,” Ms Cousin wrote in a note on Feb 28.
Such pushback is already becoming apparent. Over the past week, both South Korea and Vietnam followed in Washington’s footsteps and slapped tariffs on Chinese steel products to halt surging supplies from the world’s biggest producer of the metal.
Despite the escalation, both Beijing and Washington appear keen to prevent a breakdown in their relationship.
Chinese Vice-Premier He Lifeng spoke to Treasury Secretary Scott Bessent on Feb 21 – the second high-level contact since Mr Trump took office – indicating continued communication.
Mr Trump has also highlighted his personal ties with Mr Xi, saying last week that a new trade deal with China was possible.
While he signalled in early February that he would be speaking with Mr Xi “very soon”, that conversation has yet to take place. BLOOMBERG
