China says US stands to become ‘a joke in the history of the world economy’

Singapore: Beijing has declared that the Chinese market for US exports has been destroyed by the spiralling trade feud between the world’s two biggest economies, as it hiked its tariffs on American goods to 125 per cent in retaliation for President Donald Trump’s duties.

China’s Finance Ministry said Beijing would no longer go tit-for-tat with the Trump administration in the tariff war, saying further increases would have “no economic significance” and the United States stood to “become a joke in the history of the world economy”.

“Under the current tariff level, there is no possibility of market acceptance for American goods exported to China,” the Finance Ministry said in a statement announcing the latest increase.

Chinese President Xi Jinping has made his first public comments on the brinkmanship since Donald Trump’s April 2 tariff offensive.Credit: Fairfax Media

Chinese President Xi Jinping made his first public comments on the brinkmanship since Trump’s April 2 tariff offensive, saying during a meeting on Friday with Spanish Prime Minister Pedro Sanchez that “there are no winners in a trade war”, Chinese state media reported.

Xi told Sanchez that China and the European Union must join together in defending globalisation and opposing “unilateral acts of bullying”, a swipe at Trump’s tariff barrage.

However, Beijing also kept the door open to imposing other punitive trade measures on America – such as adding more American companies to trade blacklists and tightening export controls – in a sign that neither side yet sees an off-ramp to the escalation.

“If the US continues the tariff figure game, China will ignore it. However, if the United States insists on continuing to substantially infringe on China’s interests, China will resolutely counter it and accompany it to the end,” the Finance Ministry said.

The escalating stoush is already spilling over into other areas beyond direct trade ties. Chinese authorities on Thursday took aim at Hollywood by cutting the number of American films allowed in Chinese theatres and have cautioned citizens against travelling to the US.

China experts have speculated that further retaliation could take the form of Beijing withdrawing any co-operation on fentanyl-related issues and targeting the services sector by restricting Chinese companies from working with US consultancies.

Trump told reporters at the White House on Thursday that he thought the US could make a deal with China and said he respected Xi.

“In a true sense, he’s been a friend of mine for a long period of time, and I think that we’ll end up working out something that’s very good for both countries,” Trump said.

Beijing’s latest response comes after the White House on Friday (AEST) confirmed the cumulative tariff on China was at least 145 per cent, not 125 per cent as Trump had initially stated on social media. China’s revised 125 per cent tariff on American goods, up from 84 per cent, will take effect from Saturday.

Trump this week reversed course on his tariffs for dozens of countries, lowering them to the 10 per cent “baseline” in a 90-day reprieve, while punishing China with a higher levy. The turmoil has sent sharemarkets careening and is upending global supply chains.

As the White House began trade-deal discussions with some countries, Beijing announced Xi would depart on a tri-nations tour of South-East Asia this week, holding bilateral meetings with Cambodia, Vietnam and Malaysia, which are facing crippling duties of between 24 and 49 per cent unless they secure a deal with Trump.

Trump said countries he initially hit with a 10 per cent tariff, such as Australia and the United Kingdom, could negotiate the rate lower depending on their circumstances and what they offered the US.

The Department of Foreign Affairs and Trade did not answer whether Australia had formally contacted the administration to restart negotiations. The government is in caretaker mode for the federal election.

Trump’s allies continued to celebrate the president’s tariff strategy as a master stroke that had forced other countries to the negotiating table.

US Commerce Secretary Howard Lutnick posted on X: “The Golden Age is coming. We are committed to protecting our interests, engaging in global negotiations and exploding our economy.”

With agencies

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