WASHINGTON — President Trump announced on Friday plans to double tariffs on imports from China and hinted at the possibility of canceling his scheduled meeting with Chinese President Xi Jinping on October 29 in response to new Chinese restrictions on exports.
The announcement led to a sharp decline in U.S. financial markets, as tensions flared in the ongoing trade war due to a new directive from the Chinese Commerce Ministry mandating companies to obtain permits for exporting products that contain or are made from rare-earth minerals, such as batteries, semiconductors, and magnetic technologies.
Trump expressed concerns that this new regulation could severely impact the global economy by restricting the supply of crucial components integral to international supply chains, stating that China has until November 1 to amend its position.
“This affects ALL Countries, without exception, and clearly represents a strategy that has been in the works for years. It is completely unprecedented in International Trade and a moral failing in dealings with other nations,” Trump said in a statement made on Friday evening.
“Given China’s unparalleled position, and speaking solely for the U.S., I declare that starting November 1, 2025 (or sooner, depending on any adjustments from China), the United States will impose a 100% tariff on Chinese goods, in addition to existing tariffs. On that same date, we will also implement export controls on any and all critical software.”
The new rule from the Chinese Ministry of Commerce, which was released on Thursday, requires other nations to secure licenses to export products that contain more than 0.1% of rare-earth elements, intensifying the trade conflict with the U.S. that centers around semiconductor chips essential for cell phones, computers, and AI model data centers.
According to The Wall Street Journal, China produces approximately 90% of the world’s rare-earth minerals crucial for the manufacturing of these products.
“This is tantamount to an economic nuclear strike — a calculated move aimed at undermining the American AI sector,” claimed Dmitri Alperovitch, co-founder of the Silverado Policy Accelerator think tank, labeling it a “blackmail tactic” ahead of Trump’s expected summit with Xi in South Korea.
During Trump’s second term, the U.S. has attracted hundreds of billions of dollars in domestic and foreign investments in data centers that support AI infrastructure.
In a discussion with journalists in the Oval Office on Friday evening, Trump indicated that he was contemplating imposing export restrictions on aircraft and aviation components as a countermeasure.
As a reference, the current average tariff on Chinese imports stands at 57.6%, an increase from 19.8% just a year ago, based on data from the Peterson Institute for International Economics.
In his continuous efforts to reshape trade dynamics to favor American businesses, Trump declared this significant new tariff following a brief period of reduced tensions with China.
Prior to the announcement, the Dow Jones Industrial Average fell by 1.9%, the Nasdaq dropped by 3.56%, and the S&P 500 experienced a decline of 2.71%.
Earlier in the day, Trump criticized the Chinese action on Truth Social, remarking, “Something very peculiar is happening in China!”
Trump noted that the newly announced policy would negatively affect diplomatic relations, particularly since it applies to products made by companies based in China, even when manufactured abroad.
Start your day with all the information you need
Morning Report offers the latest news, videos, and pictures.
Thank you for signing up!
“Our relationship with China has improved significantly over the past six months, so this trade move is quite unexpected. I always suspected they were waiting for a moment to strike, and it seems I have been proven right once again!” Trump stated.
Earlier this year, Trump had escalated tariffs on Chinese imports to 145% in a reciprocal response, which he agreed to reduce to 30% as part of a bilateral de-escalation. Tariffs have since increased once more.
“However, the U.S. maintains monopoly positions that are significantly stronger and more extensive than those of China,” the president continued.
“I simply had no reason to implement them—UNTIL NOW! The lengthy letter they sent details point by point every single element they aim to withhold from other nations. What used to be standard procedure is no longer the case.”
Trump also mentioned, “I have not had a discussion with President Xi as there was no need for it. This action came as a total shock, not just to me, but to all leaders of the Free World. I was scheduled to meet President Xi in two weeks during APEC in South Korea, but now it appears there is no longer a purpose for that meeting.”
He concluded, “Depending on China’s response to the aggressive regulation they have enacted, I will feel obligated, as the President of the United States, to take financial action in retaliation. For every element China controls, we possess two.”
