Trump escalates trade war with China

President Donald Trump announced on Friday that he would be imposing a 100% tariff on China, “over and above any Tariff they are currently paying.” The tariff will go into effect on November 1 and will target rare-earth exports from China.

Trump claimed in a Truth Social post on Friday that China had “taken an extraordinarily aggressive position on Trade in sending an extremely hostile letter to the World, stating that they were going to, effective November 1st, 2025, impose large-scale Export Controls on virtually every product they make, and some not even made by them.”

Trump said he would impose this new tariff on or before November 1, “depending on any further actions or changes taken by China.”

On Thursday, Beijing expanded its restrictions on rare earth exports, expanding the list of minerals under control and extending controls targeting the overseas use of its technologies. The change to the limits reportedly affects the U.S. acutely, as China has increased the regulations on the use of its products for military purposes.

Trump called the move a disgrace, claiming that “[this] is absolutely unheard of in International Trade, and a moral disgrace in dealing with other Nations.”

Beijing is seeking to boost its leverage in trade talks, on the cusp of a meeting between Xi Jinping and Trump at the APEC summit in South Korea later this month. Administration officials see the move as an apparent effort from Beijing to secure leverage before the meeting.

Trump attempted to take leverage back, posting on Truth Social, “I was to meet President Xi in two weeks, at APEC, in South Korea, but now there seems to be no reason to do so,” The comment sparked panic across both countries, and Trump was prodded later that day whether the meeting was really cancelled, in which he backpedaled with impressive speed, saying “I haven’t cancelled, but I don’t know that we’re going to have it. But I’m going to be there regardless, so I would assume we might have it.

The White House viewed China’s increased restrictions as an escalation of the trade war, which required a measured response. Trump also criticized China for choosing Thursday for their announcement, saying, “The Chinese letters were especially inappropriate in that this was the Day that, after three thousand years of bedlam and fighting, there is PEACE IN THE MIDDLE EAST,”

Trump’s comments, and the administration response outline that there is clearly anxiety tied to China’s hold over a market the U.S. sees as critical to its military. Chinese technology and rare earth companies are heavily involved in U.S. national defence strategies, with CNN reporting that top Trump officials have had “rounds and rounds of phone calls” with Chinese tech companies and that the message has been delivered “loud and clear.”

The administration is now focused on ending its reliance on Chinese rare earth materials. The U.S. Department of War (formerly the Department of Defense) signed a $400 million partnership with MP Materials Corp in July 2025, the only American-based producer of rare earth magnets and materials.

Trump’s comments also triggered a ‘mini-crash’ of the tech-reliant Nasdaq, with the index falling 3.56 percent. The Dow and S&P also both slid, but not as dramatically as the Nasdaq.

Trump started the trade war with China in February 2018, with tariffs on solar panels and washing machines. Trump continued to impose tariffs throughout his first term. The trade war cooled during the Biden administration, but came to a head in January 2024 after Trump was elected again. Right now, 66 percent of Chinese imports into the United States face a tariff, and 63 percent of US imports face a tariff in China.