U.S. President Donald Trump reignited the trade war with China on Friday, announcing sweeping new tariffs and export restrictions in retaliation for Beijing’s move to curb critical mineral exports, ending months of fragile calm between the world’s two largest economies.
Trump unveiled plans to impose 100% tariffs on Chinese exports to the United States and to implement new export controls on “any and all critical software” by November 1, just nine days before current tariff relief measures expire.
He also hinted that a long-anticipated meeting with Chinese President Xi Jinping in South Korea later this month may no longer go ahead. “Now there seems to be no reason to do so,” he wrote on Truth Social, though he later told reporters, “I haven’t canceled. I would assume we might have it.”
The president’s moves came after China dramatically expanded export controls on rare earth elements, vital materials used in electric vehicles, aircraft engines, and advanced military systems. “It was shocking,” Trump said, accusing Beijing of issuing a “hostile order” against global markets.
The escalation marks the most severe rupture in U.S.-China relations in six months and threatens to unravel a tentative trade truce reached earlier this year after months of delicate diplomacy. Trump, who has long favored tariffs as a tool of economic leverage, said Washington would “financially counter” Beijing’s actions.
Markets reacted sharply. The S&P 500 fell more than 2%, its steepest one-day drop since April, while tech stocks slid further in after-hours trading. Investors rushed to gold and U.S. Treasury securities, and the dollar weakened against major global currencies.
“Trump’s post could mark the beginning of the end of the tariff truce,” said Craig Singleton, a China specialist at the Foundation for Defense of Democracies. “Beijing appears to have overplayed its hand.”
China, which controls over 90% of global rare earth processing, recently added five new elements and dozens of refining technologies to its export restriction list, steps widely viewed as a strategic response to U.S. efforts to limit Chinese access to advanced semiconductors and software.
The Trump administration’s retaliation could significantly affect China’s tech sector, particularly in cloud computing and artificial intelligence. Officials also indicated that further export limits, potentially on aircraft and aerospace parts, are under consideration.
Tensions have been building in recent days. On Thursday, the U.S. proposed banning Chinese airlines from flying over Russian airspace on routes to and from the United States.
Meanwhile, the Federal Communications Commission said American e-commerce sites had removed millions of listings for banned Chinese electronics.
Analysts said the latest escalation raises doubts over whether Trump and Xi will meet at the Asia-Pacific Economic Cooperation (APEC) summit in Seoul on October 31.
“They’re both turning up the pressure,” said Scott Kennedy, a China expert at the Center for Strategic and International Studies. “Either they’re trying to extract last-minute concessions before APEC, or they’ve decided a deal is impossible and are preparing for the next round of confrontation.”
With global markets rattled and Washington-Beijing relations at their most strained in months, Trump’s renewed offensive suggests the trade war that once defined his first presidency may again dominate his second.
Source: Reuters
Written By Rodney Mbua
