USA continues to suspend tariffs on Chinese imports – what now?

USA continues to suspend tariffs on Chinese imports – what now?

Trade relations between the US and China remain tense, and recent developments have heated tempers on both sides. There will be a temporary relaxation on November 10th, because how nordkurier.de reports, US President Donald Trump has announced that he will suspend the tariffs on Chinese imports that have been gradually increased since April 2023 until further notice. This comes within the framework of a decree intended to continue talks with China to resolve existing trade imbalances.

Trump has promised a 90-day extension, but the question remains how China will respond to this delay. While US tariffs increased to up to 145 percent, Beijing countered with its own tariffs of up to 125 percent and imposed export controls on important raw materials. The situation has led to a shift in trade flows and Chinese companies are under pressure, as furniture manufacturer Cai Meiqin from southern China impressively describes. Due to the high tariffs, it has stocked its products for the US market and relies on daily checks on customs levels zdf.de reported.

Countertariffs and their impact on the economy

Tensions that go beyond trade tariffs also affect strategic technologies. China has criticized US export controls on semiconductors and AI chips that make it difficult for Chinese companies to access modern technology. At the same time, the USA accuses China of deliberately withholding raw materials. The increase in tariffs is already having a significant impact on the Chinese economy, which has seen slowed growth of around 5.5% in recent quarters. However, Beijing is trying to maintain its position as an attractive trading partner, despite continued pressure from US policymakers.

Xi Jinping promoted a message of cooperation and stability during his tours of Vietnam, Malaysia and Cambodia this week. Despite the challenges of the tariff war, he shows himself ready to fight to the last consequence. This stance is supported by reports highlighting the tariffs' negative impact on American consumers and further inflaming the situation on social media.

The macroeconomic context

The US government has identified reducing the trade deficit and combating unfair trade practices as its main goals. Loud finanzmarkt.info This could reduce China's growth by up to 1%; At the same time, there are fears of a loss in the value of the yuan or capital outflows. The US economy could also benefit from higher tariff revenues in the short term, but there is a risk of rising prices for imported goods, which could fuel inflation and weigh on consumer purchasing power.

The tariff break coming up on November 10th could not only defuse the current situation, but also create the opportunity for future negotiations. But it remains uncertain how political and economic factors will affect the relationship between the superpowers in the period after the extended tariff break. It is clear to everyone involved: There are basically no winners in this tariff war.