China has significantly increased tariffs on U.S. goods from 84% to an unprecedented 125% on Friday. This move comes as a countermeasure to the Trump administration’s similar actions.
What Happened:
China’s Customs Tariff Commission of the State Council has declared that any additional tariffs imposed by the U.S. will be disregarded. “Given that U.S. exports to China already have no market acceptability under the current tariff rates, if the U.S. further imposes additional tariffs on Chinese goods, China will simply ignore them,”
The commission maintains that U.S. exports to China are already struggling to find market acceptability under the current tariff rates, reported the South China Morning Post.
A spokesperson for the Ministry of Commerce emphasized China’s commitment to safeguarding its legitimate rights and interests, supporting the multilateral trading system, and maintaining the stability of the international economic order.
The ministry criticized the U.S. tariff measures as “a typical act of unilateral bullying and coercion,” which violate World Trade Organization rules and undermine the rules-based multilateral trading system and international economic order.
The spokesperson also called on the U.S. to “immediately correct its wrongdoings and revoke all unilateral tariffs imposed on China.”
In his first reaction to President Donald Trump‘s tariffs on China, Xi Jinping told visiting Spanish Prime Minister Pedro Sanchez, “There are no winners in the tariff war and standing against the world ultimately results in self-isolation,” as per state news agency Xinhua.
No matter how the external environment shifts, China will maintain its resolve and focus, dedicating itself to managing its own affairs efficiently,” added Xi.
Why It Matters:
The decision to increase tariffs comes as President Donald Trump awaits negotiation talks with his ‘friend’ Xi Jinping.
According to China expert and political commentator Gordon Chang, the Chinese President is avoiding direct negotiations with President Trump to prevent potential political backlash at home. Xi is in a difficult position where initiating a conversation with Trump about the trade war could lead to backlash from his fellow Communist Party leaders.
Notably, China is not immune to the adverse impact from Trump’s tariffs. Goldman Sachsdowngraded China’s growth forecast and warned of risk to 20 million export-linked jobs in the nation. However, the investment bank cited overall global economic gloom as a reason besides Trump’s tariffs.
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Originally Posted on April 11, 2025 – Xi Jinping Says ‘There Are No Winners In Tariff War’ As China Slaps 125% Tariffs On US Goods, Urges Trump To Immediately Correct ‘Wrongdoings’
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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Geopolitical game theory in action, The Nash equilibrium/Ultimatum Game Two players have a pot of money to divide. One player (X) proposes a split. The other player (Y) can either accept or reject X’s proposal. If they both accept the pot is split accordingly. If player Y rejects the X’s proposal they both get nothing. So does player X offer Y a small split in the hope they will accept something rather than nothing, or will X play fair and offer something larger to guarantee an outcome. A Nash equilibrium is a situation where neither player can unilaterally change tactics to improve their outcome. Stalemate. Both players know their opponent’s strategy so the most optimal strategy for both players is the stick firm, because in the final analysis neither player will receive additional concessions by changing tactics – assuming of course the other player doesn’t cave in under pressure. Trump v Jinping 2025.
Took game theory when I was an undergraduate at UC Berkeley. The T vs J 2025 outcome will not be Pareto efficient.
Can the trading relationship between the US and China ever be Pareto Efficient when it didn’t start that way. T v J is about who can do the most damage to the other’s economy; but keep thinking along these lines because eventually game theory may be the deciding factor.