Washington, October 11: U.S. President Donald Trump on Friday warned that the United States could impose an additional 100 percent tariff on Chinese imports starting November 1—or earlier—raising the stakes in an already tense trade relationship and fueling concerns of a renewed global trade war.
Trump voiced his frustration over China’s newly introduced export controls on rare earth elements, tweeting that “there seems to be no reason” to meet Chinese President Xi Jinping during his upcoming trip to South Korea. Later, he told reporters that while the meeting had not been formally cancelled, it remained uncertain. “I’m going to be there regardless, so I would assume we might have it,” he said. He added that there may be scope to adjust the new tariff threat, noting, “That’s why I made it Nov. 1.”
China’s Export Restrictions
On Thursday, China restricted the export of rare earth minerals, requiring foreign companies to seek approval before shipping the metals abroad. It also imposed rules on exporting technologies used in the mining, smelting, and recycling of rare earths, while blocking shipments for military applications. Trump described the move as “shocking” and “out of the blue,” claiming China was “holding the world captive” by limiting access to metals critical for electronics, computer chips, lasers, and jet engines.
Trump declared that the U.S. would retaliate by imposing a 100 percent tariff on Chinese goods, in addition to current duties, and by applying export controls on American software critical to national interests. The Chinese Embassy in Washington had not responded to requests for comment.
Financial Markets React
The S&P 500 dropped 2.7 percent in reaction to the announcement, marking the worst day for U.S. stocks since April, when similar tariff threats spurred market concerns. Analysts warned that additional tariffs could further destabilize U.S.-China trade and slow global economic growth. Trump’s tendency to back down from threats—dubbed the “TACO” trade (“Trump Always Chickens Out”)—adds uncertainty for investors.
Despite previous trade negotiations in Switzerland and the U.K., tensions persist as China continues restricting U.S. access to rare earths essential for various technologies. The European Union Chamber of Commerce in China stated that the latest controls “add further complexity to the global supply chain.” Other points of friction include U.S. limits on Chinese imports of advanced computer chips, restrictions on American soybean exports, and reciprocal port fees.
Experts Suggest Room for De-escalation
Trump has not formally cancelled the meeting with Xi but hinted at uncertainty. His trip will include stops in Malaysia, Japan, and South Korea, coinciding with the ASEAN and Asia-Pacific Economic Cooperation summits.
Experts said there is still room to ease tensions. Sun Yun of the Stimson Center said China’s export restrictions were a reaction to U.S. sanctions but noted potential for negotiation. Gracelin Baskaran of the Center for Strategic and International Studies highlighted China’s control over rare earth mining and permanent magnet production, describing it as a “powerful negotiating tool.” Craig Singleton of the Foundation for Defense of Democracies warned that Trump’s announcement could signal the end of the tariff truce, with both sides escalating economic measures simultaneously.
