US President Donald Trump rocked the global economy with the introduction of duties on imports into the United States. However, while many US trading partners have lined up to offer Trump concessions in exchange for further co-operation and tariff relief, others, such as China, are getting dragged into what is likely to become new trade wars and are showing determination to confront the US.
China retaliated against the US by imposing 34% tariffs on US imports. However, the US, in turn, brought the total level of duties against China to a staggering 104%.
The Chinese embassy in Washington said that Beijing had no intention of conceding and would firmly resist the pressure. As a result, the Chinese government imposed additional 50% tariffs, raising the total duty on US goods to 84%.
Goldman Sachs estimates that the first 50% of duties will indeed hit China’s GDP, reducing it by 1.5 percentage points, but an additional 50% will add only 0.9% to the decline. Thus, further tariff pressure will be progressively inefficient. Meanwhile, China has kept its official economic growth forecast at 5%.
Analysts argue that the damage from the US tariffs will be less devastating than expected, largely due to the resilience of the Chinese economy and its ability to quickly diversify export markets. At the same time, China’s shift towards other global importers may encourage other countries to more actively seek alternatives to the US market.
Tariff gamble
In the US, however, troubling signals are starting to sound, as another round of duties could hit US imports, raise prices and shake business loyalty. Trump is likely counting on China to offer to change the terms of co-operation itself under US economic pressure, and is ready to offer “generous” terms.
However, China does not appear to be an easy target in a large-scale economic war. If potential deals around tariffs seem possible with other eastern partners like India or Japan, China is often perceived by the United States as some kind of economic threat.
As for the European Union, Trump recently described it as a threat, stating, “It was formed to do damage to the US.” It is also remarkable that against the background of the tariff panic, the US reveals a record trillion-dollar defence budget.
Some analysts note that the shift from a peacekeeping stance to a Cold War approach coincided with a recent report by the US National Intelligence Service that the war in Ukraine, if continued, could become a threat to the United States.
How US speculates on European issues
The US is also seeking to boost liquefied natural gas (LNG) exports to Europe. The industry is said to employ 270,000 people and has added more than $400 billion to the US GDP since 2016, with cumulative revenues exceeding $800 billion.
Currently, the expansion of terminals is underway, and by 2030 Washington plans to have 1.3 billion cubic metres of LNG every day. Experts note that the confrontation between Russia and Ukraine is also favourable for the US, as Europe is refusing Russian energy resources against the background of the war.
Meanwhile, the US is actively offering a substitute, its own LNG, but at higher prices.
Severing economic ties with Russia has cost Europe a record 544 billion dollars. The figure was announced by European Commission President Ursula von der Leyen, who spoke at an international economic forum and said that EU member states had overpaid for energy imports in 2022-2024.
Instead of Russia, the money went to sellers from the US, Norway and the Middle East, with total losses to the EU economy exceeding 1.3 trillion euros, according to the IMF and Eurostat.
THE ARTICLE IS THE AUTHOR’S SPECULATION AND DOES NOT CLAIM TO BE TRUE. ALL INFORMATION IS TAKEN FROM OPEN SOURCES. THE AUTHOR DOES NOT IMPOSE ANY SUBJECTIVE CONCLUSIONS.
Xiao Duong for Head-Post.com
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