On Friday, President Donald Trump announced plans to enforce a 100% tariff on every product imported from China, and to introduce export restrictions on "all critical software" originating from the United States.
This marks the most recent development in what appears to be a growing trade dispute between China and the United States. In his Truth Social post revealing the new tariffs, Trump stated that these measures would be "in addition to" any existing tariffs on Chinese goods. (According to CNBC, current U.S. tariffs on Chinese imports differ by product, but the standard rate is already at 40%.)
Earlier in the week, China revealed that it would be strengthening its export regulations on rare earth minerals, now requiring foreign businesses to obtain a license to export products containing even minimal amounts of these minerals. As the top global supplier of rare earth minerals—essential for technology products like semiconductors and solar panels—China’s move has significant implications for the tech sector.
Trump characterized China’s new policy as “completely unprecedented in International Trade, and a profound ethical failure in relations with other Nations.”
“It’s hard to imagine China would make such a move, but they have, and now it’s part of history,” he commented.
Trump indicated that the new tariffs are scheduled to begin on November 1. After making the announcement, he reportedly told reporters that the tariffs could still be reversed, and that he might not call off a planned meeting with President Xi Jinping.
Following Trump’s statement, stock markets fell sharply: the Dow Jones Industrial Average dropped 1.9% by Friday’s close, the S&P 500 declined 2.71%, and the Nasdaq slid 3.56%. Certain technology firms, such as Nvidia and Tesla, experienced losses of about 5% by the end of trading.
The announcement also impacted cryptocurrency markets, triggering liquidations that were reportedly ten times greater in dollar value than those seen during the FTX collapse.