Trump clarifies that tariffs on China are 145%

Brussels / WashingtonAnother U-turn by President Donald Trump and a renewed surge in the markets due to the US president's volatility. The White House now says that tariffs on China will be 145% instead of 125%, as Trump decided yesterday after announcing a 90-day partial truce for the rest of the world. The change comes three hours after the Republican administration sent the executive order drafted yesterday with the modifications, which still speaks of 125% tariffs for Beijing. Trump's decision to redouble tariff pressure on the Asian giant caused the S&P 500 to fall 5% and the Nasdaq to fall 6% after Wall Street opened lower.

At Thursday's Cabinet meeting, when the president was asked if he could comment on the market plunge that followed the 145% announcement, Trump dodged a question: "Well, I haven't seen it because I've been here for two hours." The Republican then passed the buck to his Treasury Secretary, Scott Bessent, who downplayed the situation. Bessent said that "up two [points] and down one [point] is not a bad number." Despite the roller coaster ride that the markets have taken in recent days, Trump hailed his trade policy, proclaiming: "Yesterday was a historic day, the greatest day in the history of the markets."

The 145% tariff the president is now announcing already includes the 20% currently in effect, but we must add the general 25% tariff on vehicle imports, as well as taxes on steel and aluminum (also 25%), and other specific levies on Chinese products that Trump has imposed. Therefore, for certain products, the total could climb to 170%.

Today's increase in Chinese tariffs is Trump's fourth in just one week. When the president unveiled his tariff schedule last Wednesday (the "day of liberation"), China was entitled to 34%. But after China said it wasn't planning on backing down from the tariff war, the tycoon raised the figure to 84%. On Tuesday, when Beijing still hadn't let up and announced it would apply the same figure, 84%, to US imports, Trump upped the ante and raised the rate to 125%. And, this Thursday, it has become even more unhappy, rising to 145%. Beijing has continued to attack the US administration, and Chinese Foreign Ministry spokesman Lin Jian has accused it of "seriously violating World Trade Organization (WTO) rules."

Trump acknowledged on Wednesday that the decision to roll back his tariff war against the rest of the world was a last-minute move. From the Oval Office, he explained to reporters that he had drafted the executive order with the partial truce and the 125% tariffs "from the heart" because they hadn't had time to hire a lawyer. He also commented that when deciding on exceptions for some companies, he would do so according to "intuition." This Thursday, he assured that he was not considering [any exceptions] for any country or company. "But it's possible that I will. We don't have that situation right now," he declared.

Meanwhile, Brussels has come to a standstill following yesterday's announcement of a 90-day reduction in taxes to 10% for all countries subject to so-called reciprocal tariffs. After Washington partially postponed the general 20% tariffs in the European Union, Ursula von der Leyen announced in a statement that the European Commission is putting the measures "on hold." the import rates it approved This Wednesday, the EU bloc has launched a series of strikes against US products and urged the Republican administration to find an agreed solution to the trade war. "We want to give negotiations a chance," the president of the EU executive said in a statement issued this Thursday.

However, this is by no means a definitive withdrawal of the tariffs agreed to by the EU on Wednesday. As EU Trade spokesperson Olof Gill explained in a press conference, Brussels simply wants to leave the door open to negotiations with the US administration and warns that, if these negotiations prove fruitless, it reserves the right to "push the button" again and impose import tariffs "on any other market." "All options [to respond to Trump] remain on the table," warns Von der Leyen.

The countermeasures approved this Wednesday by the EU were not a priori a response to the general tariffs that Trump has partially postponed, but to those already in place against European steel and aluminum products. However, the European Commission wants to send a diplomatic message to the US and is avoiding pushing ahead with an increase in import tariffs while Washington apparently loosens the rope. In fact, its intention is to put more pressure on the Republican administration and make it clear that the ball for ending the trade war always rests in the White House's court. "You know, however, that it takes two to tango," the EU spokesperson recalled.

The European Commission made this decision after several state leaders celebrated Trump's 90-day grace period and renewed calls for negotiations with Washington. For example, Spanish President Pedro Sánchez, speaking from Vietnam, interpreted it as "an open door to negotiation" to end the White House's escalation of "unfair and unjustified" tariffs, and Polish Prime Minister Donald Tusk urged Brussels and his counterparts to use the additional time the New York magnate has given them to negotiate.

Some European voices also see it as a success for the EU's response capacity. "We Europeans are determined to defend ourselves, and it has been proven that unity helps us all," asserted the future German chancellor, Friedrich Merz. In fact, the European partners approved the list of US products on which tariffs would be raised almost unanimously on Wednesday, with only Hungary, led by the far-right pro-Russian leader Viktor Orbán, who is also close to Trump, voting against.

Brussels has decided to postpone for 90 days the entry into force of the taxes on the products on the list that were to begin to be applied from this April 15th and next May 16th and, in the exceptional case of some hazelnut and soy derivatives, from May 1st. Beyond these three months of margin that it gives Trump, however, the European Commission does not want to rush events and has lamented the chaos reigning in the White House. "This changes every day and every hour. Therefore, we will face it day by day and hour by hour," said the EU spokesperson for Trade.

Spain is getting closer to China

Sánchez arrives in China in the midst of a trade war between the US and the EU, and at a time when Brussels is increasingly distancing itself from Beijing. One of the intentions of the president's trip is to strengthen Spain's and the EU's overall ties with the Asian giant, which are not exactly in the best of times. However, Sánchez is swimming against the current within the European bloc, and both Brussels and most of its European partners, who have classified China as a "systemic rival," are pushing to reduce trade ties with China, especially in critical sectors in which the European bloc has strong dependencies.