Trump’s New 104% Tariff on China Sparks Global Trade Tensions

The United States has officially put a 104% tariff on goods from China, starting a new and more intense chapter in the ongoing trade fight between the two countries.

The new tariff—announced by President Donald Trump—is part of his plan to change how global trade works. China, America’s biggest trading partner, is the most affected.

Trump first set a 34% tariff, but after China responded with its own, he raised it by another 50%, bringing the total to 104%.

At a dinner with fellow Republicans on Tuesday night, Trump said, “These countries are calling us up kissing my ass,” claiming the tariffs are bringing in nearly $2 billion every day.

He also said more tariffs, especially on medicine, could be coming soon.

Trump added that he is working on “special deals” with friendly countries like Japan and South Korea.

China Plans to Hit Back

China says it will not back down and plans to fight the trade war “to the end.” In response to the U.S. move, China will begin its own 34% tariff on U.S. goods starting Thursday.

Trump claimed China “wants to make a deal badly, but they don’t know how to get it started.”

Stock Markets Fall

The news has caused problems in global financial markets:

• Hong Kong stocks dropped more than 3%
• Japan’s Nikkei index fell 2.7%
• Taiwan’s market dropped 5.8%
• South Korea’s currency fell to its lowest level since 2009
• China’s offshore yuan hit a record low

Oil prices also went down. The U.S. oil benchmark, West Texas Intermediate (WTI), fell below $60 a barrel for the first time since April 2021.

Market expert Stephen Innes warned that China is struggling under the pressure. “Letting their currency fall slowly won’t be enough to fix the damage from such big tariffs,” he said.

Other Countries React

Other countries are also responding. Canada will start its own tariffs on U.S. car imports. The European Union is warning against making the situation worse, but it’s also preparing to hit back.

EU Commission President Ursula von der Leyen told China’s Premier Li Qiang that the world economy needs “stability” and that all sides should try to avoid more trouble.

Still, the EU plans to place new taxes—up to 25%—on U.S. products like soybeans and motorcycles.

Inside the U.S., not everyone supports the tariffs. Billionaire Elon Musk strongly criticized Trump’s trade adviser, Peter Navarro, calling him “dumber than a sack of bricks.”

This came after Navarro called Tesla a “car assembler” that relies on cheap foreign parts.

As the trade fight grows, experts warn that prices for everyday goods may rise, and the global economy could face more serious problems.