Will Donald Trump's $60% Tariff 'Impact' China? Govt Official Responds

After the resounding victory of Donald Trump in US presidential elections, once he takes over the president’s office in January, the first and foremost thing he is likely to do is to impose tariffs on Chinese imports, higher than what he imposed in his first term. But in a response to US threats of imposing steep tariffs on Chinese goods, a senior Chinese official has asserted that such a move would ultimately harm American consumers.

Vice Commerce Minister Wang Shouwen argued that higher tariffs would lead to increased prices for US consumers, exacerbating inflationary pressures. He further emphasised that China, with its resilient economy, is well-positioned to withstand such "external shocks."

"We believe that if China and the US can maintain a stable, healthy, and sustainable development trend in economic and trade relations, it will be beneficial (to everyone)," Wang stated during a press conference.

Tariff Ramifications

Trump has been a proponent of tariffs as far as imports from China are concerned. According to a Reuters poll, at the beginning of 2025, the US government is likely to impose around 49 per cent tariffs on Chinese imports. This will lead to the erosion of Chinese growth by 1 percentage point. The tariffs that are likely to be imposed after Trump takes over office in January, the tariffs are going to be higher than 7.5-25 per cent imposed during his first presidential term.

According to the poll, the tariffs will impact Chinese growth which is already facing challenges on multiple fronts. China is resorting to stimulus to pull the Chinese economy out of the gloom. So tariffs as expected by  Trump might have an impact on China's already flailing economy.  

China has actively sought to diversify its export markets and reduce its reliance on the US. The country has invested heavily in infrastructure projects and technological innovation to drive domestic consumption and boost economic growth.

However, the potential imposition of hefty tariffs could significantly impact China's economic trajectory, particularly as it grapples with a slowing property market and mounting local government debt. Analysts warn that such a move could shave off a substantial portion of China's projected economic growth.

Despite the escalating trade tensions, China remains committed to fostering economic growth and expanding trade relations with other countries. The nation has implemented various measures to streamline customs procedures, relax visa restrictions, and encourage international tourism.

As the US-China trade war continues to escalate, the global economy hangs in the balance. The potential for a full-blown trade war could have far-reaching consequences, including higher prices for consumers, slower economic growth, and increased geopolitical tensions.