Trump Imposes 100% Tariffs on China as U.S.–China Trade War Reignites

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2025-10-12

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U.S. President Donald Trump announced that starting November 1, his administration will impose a new 100% tariff on Chinese goods and introduce export controls on “critical software” in retaliation for China’s latest restrictions on rare earth exports. The move marks a renewed escalation in U.S.–China tensions after several months of tariff truce.

On October 9, Beijing unveiled two new regulations imposing export controls on rare earth materials and related technologies. Under the new rules, any product containing more than 0.1% of Chinese-produced rare earth materials must obtain export approval, while companies linked to foreign militaries will be denied permits in principle. The measures are seen as China’s counter to U.S. chip export restrictions and could disrupt global supply chains for AI, semiconductors, and electric vehicles.

The announcement triggered market turmoil, with the Dow Jones Industrial Average plunging nearly 900 points. Tech stocks led the decline, as Nvidia fell about 5% and AMD dropped 8%. Over the past six months, the U.S. and China have continued to impose various non-tariff barriers, with Washington expanding its export blacklist and Beijing launching investigations into U.S. firms such as Qualcomm and Nvidia.

Trump had been scheduled to meet Chinese President Xi Jinping during the upcoming APEC summit, but he hinted on social media that the meeting could be canceled after criticizing China’s new export restrictions. However, he also noted that the new tariffs could still be withdrawn before taking effect. Analysts say Beijing’s move may be aimed at strengthening its leverage ahead of the summit. While both sides remain open to dialogue, the latest clash highlights the fragility and high volatility of U.S.–China relations.