US-China Trade War Escalates, Trump Levies New 100% Tariff After Beijing’s ‘Extremely Hostile Letter’

US President Donald Trump announced on Friday that he will impose an additional 100% tariff on Chinese imports starting November 1, or sooner, in response to China restricting exports of rare earth elements crucial for American industries. Trump made the announcement on Truth Social, saying the move was necessary because China has taken “an extraordinarily aggressive position on trade.” What Donald Trump SaidThe president indicated that he might skip a scheduled meeting with Chinese President Xi Jinping during his upcoming trip to South Korea for the Asia-Pacific Economic Cooperation (APEC) summit. Trump wrote, “I was to meet President Xi in two weeks… but now there seems to be no reason to do so,” signaling rising tensions between the world’s two largest economies. Related News | ‘Peacekeeper Because of Tariffs’: Trump Claims He Stopped India-Pakistan Clash with Trade ThreatsChina recently restricted access to rare earth elements used in electronics, military technology, and other critical industries, requiring foreign companies to obtain special export permits. Trump described China’s move as “especially inappropriate” and said it gives the country an unfair advantage over the US, even suggesting the timing may undermine his role in brokering the recent Gaza ceasefire.Impact On Financial MarketsTrump’s announcement sent shockwaves through financial markets. The S&P 500 dropped 2.7% on Friday, marking its worst day since April, as investors worried about a potential escalation of the trade war and disruption to the global economy. Analysts warned that such a sharp increase in tariffs could hurt supply chains and industry.Experts say that Trump’s threat may be a negotiating tactic or a sign of worsening trade tensions, as per KOB News report. Gracelin Baskaran from the Center for Strategic and International Studies highlighted China’s market leverage, saying that it produces 70% of mined rare earths and 93% of permanent magnets critical for US technology and defense. Wendy Cutler of the Asia Society Policy Institute called the move a sign of the fragile détente between the two countries.Past Trade WarThis is not the first time Trump has used tariffs as leverage against China. Earlier rounds of US tariffs led to a trade war, with both nations imposing high taxes on each other’s goods. Previous negotiations reduced US tariffs to 30% and Chinese tariffs to 10%, but disputes over rare earths, soybeans, advanced computer chips, and port fees continue to strain relations.Craig Singleton from the Foundation for Defense of Democracies warned that “mutually assured disruption between the two sides is no longer a metaphor,” as both nations appear ready to use economic tools aggressively.