US President Donald Trump has threatened to impose new tariffs on China, warning that if Beijing does not increase shipments of rare earth magnets to the US, he would be forced to charge them a 200% tariff.
This move signals a new and volatile front in the ongoing economic battle between the world’s two largest economies.
Trump’s comments came during a press conference with South Korean President Lee Jae-myung at the Oval Office, where he emphasized the importance of securing a stable supply of rare earth magnets from China.
The US president’s escalation comes despite a 90-day pause on increased tariffs that was agreed upon earlier, and as negotiations between the two nations loom.
China is increasingly sensitive about rare earth elements and its control over their supply, having added several rare earth items and magnets to its export restriction list in April in retaliation for tariff hikes by the US.
Beijing represents 90% of the global magnet market, which is critical to key products, including semiconductor chips used in products like smartphones.
Trump’s aggressive posture on tariffs has raised concerns about the potential consequences for the global economy.
According to recent data, China’s exports of rare earth minerals surged in July, with imports of rare earth ore rising by more than 4,700 tonnes compared to June.
This increase in exports has given Beijing more leverage in negotiations with Washington. The US had previously announced a 10% stake in Intel, one of the world’s largest semiconductor chipmakers, which relies on rare earth materials for their products.
The ongoing trade dispute between the US and China has significant implications for the global economy. The two countries had shown signs of easing tensions earlier this month, with President Trump signing an executive order extending a 90-day deadline on tariffs against Chinese goods.
Had the order not been signed, tariffs would have jumped to 145%. In May, the two countries had agreed on 30% US tariffs, while dropping levies to 10%, down from 125%.
The US president’s comments have sparked concerns about the potential consequences of a prolonged trade war. Some experts believe that Trump’s remarks signal an eagerness to seal a deal, not break one.
Henry Wang, founder of the Beijing-based think tank Center for China & Globalization, suggested that the remarks could be a calculated bluster of a master negotiator. Others, however, are more skeptical, warning that the rhetoric of conflict could give way to the reality of cooperation.
The fate of the truce beyond its November deadline will hinge on upcoming engagements between US and Chinese officials. Senior Chinese trade negotiator Li Chenggang is reportedly heading to Washington this week for crucial meetings with US officials. These meetings could lay the groundwork for enduring solutions to ease tensions between the two nations.
Trump’s threat of new tariffs on China over magnets has significant implications for the global economy. The ongoing trade dispute between the US and China has raised concerns about the potential consequences of a prolonged trade war.
As negotiations between the two nations continue, the world watches with bated breath, waiting to see if the rhetoric of conflict will give way to the reality of cooperation.
The ongoing trade dispute between the US and China has taken a new turn with President Trump’s threat to impose a 200% tariff on Chinese magnets, specifically rare earth magnets crucial for manufacturing products like smartphones, chips, and electric vehicles.
This move signals a dramatic escalation in the economic battle between the two nations, with Trump’s administration prioritizing national security and patriotism. China’s control of 90% of the global magnet supply puts the US in a tight spot, and Trump’s threat highlights the complexities of their trade relationship.
Experts believe Trump’s remarks may be a calculated bluster, aiming to seal a deal rather than break one, as senior Chinese trade negotiator Li Chenggang is set to meet with US officials in Washington this week to discuss the impending tariff deadline.
Given the current dynamics, the fate of the truce beyond its November deadline will hinge on these engagements.
While some experts see Trump’s threat as a negotiating tactic, others warn that the rhetoric of conflict could give way to the reality of cooperation. With China’s rare earth exports surging in July and the US taking a 10% stake in Intel, one of the biggest chipmakers in the world, the stakes are high.
The White House has extended a 90-day deadline on new tariff hikes against Chinese imports, allowing more time for negotiations. However, Trump’s aggressive posture on tariffs has raised concerns about the potential consequences for the global economy.