Tit for tat apart, tariff war between US &
China might fizzle into a damn squib because neither of them are capable of
sustaining it without inflicting self-harm as well as harming each other and in
that process the entire globe. The bottom line is geoeconomics balance go berserk.
Here is a chronological sequence of events
beginning on April 3, 2025:
On the even date a 25% tariff was imposed on automobiles imported from
all countries by President Trump.
April 4
A baseline 10% surcharge was imposed, virtually upon all countries. Additional reciprocal tariff was announced to start from April 9, on all countries that have trade surplus in their favour. Tariff for China was worked out as 34%
China retaliated by fixing similar percentage i.e. 34% flat rate on all US imports. Moreover, all rare earths export to USA would be subjected to export control. This includes Samarium, gadolinium, scandium and host of others vital for US technology manufacture.
April 8
Stung more by the export control on rare earths rather than tariff retaliation Trump ordered additional 50% on Chinese imports taking the total to 84% as tariff to be levied on all Chinese exports to USA.
April 9
A new baby was born (or stillborn) in the like of “Differential
Tariff”, where a graduated rate beginning from 1% to 74% is to be surcharged on
all countries that have trade surplus in their favour.
However, Trump had change of heart and effected a pause over differentiated tariff
on all countries for 90 days except for China.
In effect, China now face 125% and not 84% tariff
as announced on April 8
April 11
China not to
give way to the Trump bulldozing, decided to mirror image the 125%
of tariff on all imports from USA.
While I thank for data credit by Peterson Institute of International Economics, I take gumption to state that neither USA nor China stands to benefit out of this nonsensical tariff war. Japanese describe this type of action as “hara-kiri”. America needs China by extension China needs America. When elephants fight it is the grass that suffers. The crux of the matter is almost the entire globe depend on these two supremoes!
As one who straddles in “navigating business strategy amid
geoeconomics”, my studied advice for both USA & China to be mindful
of not only them but the entire world which is waiting in bated breath over the
outcome of this senseless tariff war!
Cheers!
Muthu Ashraff Rajulu
Business Strategist
Mobile: + 94 777 265677
E-mail: cosmicgems@gmail.com
Blog: Business Strategist
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