Rabat – US President Donald Trump has warned that he will place a new 50% tax on Chinese imports if China does not cancel its own 34% tax on American goods. This comes as global stock markets continue to drop sharply.
China had announced its new tariffs on Sunday in response to Trump’s earlier decision to place a 34% tax on Chinese imports last week. That tax was part of what Trump proclaimed to be “Liberation Day” on April 2, in which he rolled out a series of tarrifs with at least a 10% tax on most countries that trade with the US.
Trump gave China until Tuesday to withdraw its tariffs. If not, Chinese goods could face a total tax of 104%, including previous tariffs already in place.
China’s commerce ministry criticized Trump’s move, calling it “a mistake on top of a mistake.” It added that China will not give in to “blackmail.”
This back-and-forth has raised fears of a deepening trade war between the world’s two largest economies.
Markets around the world reacted strongly to the news. Hong Kong’s Hang Seng index dropped more than 13%, its biggest fall in a single day since 1997. Stocks in Taiwan, Singapore, Thailand, and Indonesia also dropped, with some markets falling as much as 9%.
In the US, stock markets opened lower on Monday but recovered slightly later in the day. In Europe, London’s FTSE 100 and other major indexes closed more than 4% down.
Speaking at the White House, Trump said that the US was acting to protect itself and reduce its $36 trillion debt.
“We’re not stopping global tariffs,” he said. “Countries are coming to negotiate fair deals with us.”
Trump said that if China continues with its tariffs, the US will respond immediately with higher taxes. He also said that any discussions with China on trade would be canceled if the country doesn’t back down.
A spokesperson for China’s embassy in the US said the American government is acting selfishly and going against international rules. “This is economic bullying,” said Liu Pengyu. “China will not be pressured or threatened.”
Trump said negotiations on tariffs with different countries will begin right away. On Monday, he met with Israeli Prime Minister Benjamin Netanyahu, who promised to fix the trade imbalance between Israel and the US quickly. Israel is set to face a 17% tax on its exports to the US starting April 9.
