China again raised tariffs on U.S. goods, now hiking them to 125% in retaliation to President Donald Trump's latest trade escalation.
Beijing dismissed the move as a joke, with the Finance Ministry saying in a statement that the "U.S. side's imposition of excessively high tariffs on China seriously violates international economic and trade rules, runs counter to basic economic principles and common sense, and is simply an act of unilateral bullying and coercion."
China, however, added that it would be the last time it matched a U.S. hike, claiming it would "no longer have any economic significance and it would go down as a joke in the history of world economics."
"If the U.S. continues to play a numbers game with tariffs, China will not respond," the ministry added. However, Beijing did hint that it could retaliate in other ways. The country already announced it would restrict Hollywood films.
Katherine Tai, who worked during the Joe Biden administration, has warned that China is preparing for "prolonged economic warfare" and that factories in the U.S. and around the world will close as a result.
She went on to say that Chinese companies had previously offered discounts to longtime U.S. clients, but now are willing to give up the market entirely and find new buyers elsewhere. In fact, China has been expanding its trading blacklist and also those facing export controls.
The Daily Mail detailed that Beijing will likely impose more controls on products needed by U.S. companies to make their own, especially through regulatory investigations and penalties. It might also seek for them to give up intellectual property or be banned from doing business in the country.
Beijing has vowed to "fight to the end" against Trump's tariffs, with top official Li Qiang saying authorities were "fully confident" in the resilience of the Chinese economy. Moreover, Chinese leader Xi Jinping said the nation is "not afraid" to engage in the trade war. He told Spanish Prime Minister Pedro Sanchez that "there are no winners in a trade war, and going against the world will only lead to self-isolation."
"For over 70 years, China's development has relied on self-reliance and hard work — never on handouts from others, and it is not afraid of any unjust suppression," Xi added, according to state broadcaster CCTV.
Trump's trade representative Jamieson Greer told reporters that there are no negotiations with China as of yet. "I would say that the Chinese reaction this morning is not terribly surprising but certainly unfortunate," he added.
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