US and China Trade War

On February 4, 2025, US tariffs of 4% were imposed on all Chinese imports under the International Emergency Economic Powers Act (IEEPA). Shortly after, China matched the US by imposing tariffs ranging from 10% to 15% on certain goods, such as coal. They also launched an anti-monopoly investigation against Google. 

The economic conflict stems from long-standing tensions between the two countries, which escalated in 2018 when the Trump administration imposed tariffs on Chinese imports. One of the United States’ goals was to reduce its trade deficit with China. There was some reduction in the trade deficit, but it’s unclear if it’s a result of tariffs or other factors such as the pandemic. Another objective was to bring back manufacturing jobs. However, tariffs alone didn’t incentivize reshoring, and some companies opted to relocate to Southeast Asia instead. It also addressed Chinese practices regarding intellectual property theft and forced technology transfers. China has denied these allegations but has made an effort to resolve the concerns. For example, the country passed the Foreign Investment Law in 2019, which banned forced technology transfers.

China had its objectives in this war, too. They imposed retaliatory tariffs on US goods. The country focused on diversifying its export market and supply chains to decrease dependence on the United States. It negotiated a deal with the U.S, called the Phase One agreement, in January 2020. China is committed to buying $200 billion of U.S. services and goods in the span of two years. However, the global pandemic caused a temporary collapse in global trade, and China failed to meet the criteria. 

A United Nations analysis released on November 6 reported that the tariffs are “economically hurting both countries.” American consumers and manufacturers are facing higher prices, while farmers are facing financial difficulties. China experienced a slowdown in economic and industrial output growth, which was already decreasing at the time. Some countries suffered economic damage while others benefited because production was moved to that country. The global stock market also became unstable. In 2025, China’s GDP grew by 5.2% despite the trade war, because of government support and front-loading shipments by Chinese factories before the second Trump administration’s tariffs. 

Chinese President Xi Jinping states that trade wars have no true winners. China has retaliated against tariffs, which the president claims are intended to protect its economic interests while negotiating with the U.S. The general public was surprised. Domestic news coverage was censored, and online social media posts were also subjected to censorship, despite the issue becoming a hot topic.

In the United States, some Democratic Senators advocate for the trade war, saying it was necessary, while others believe the means by which Trump wasn’t right. Others do not offer their support because the war puts a burden on American consumers and has caused inflation. However, annual inflation rates show that not much of a difference in inflation has occurred during the trade war (2018-2020, 2025). Most Republicans’ opinions mirror that of President Trump, supporting actions like implementing higher tariffs.