Tag: U.S.–China trade war

In the first quarter of 2025, the U.S. economy contracts in Q1 2025 by 0.3%, marking the first decline since early 2022. This downturn was primarily driven by a surge in imports as businesses and consumers rushed to purchase foreign goods ahead of new tariffs introduced by President Donald Trump. The resulting record trade deficit significantly dragged down GDP. 

On April 2, 2025, President Donald Trump launched a dramatic recalibration of American trade policy, issuing Executive Order 14257, which levied a 10% baseline tariff on all imports into the United States, with targeted rates as high as 54% on specific nations, most notably China. Declaring the day as "Liberation Day," the administration framed this bold action as an economic emancipation from foreign trade dependencies. The announcement sent immediate shockwaves through global markets: the S&P 500 registered its steepest one-day drop since the early days of the COVID-19 pandemic, and bond markets reacted with heightened volatility. These events prompted fierce debate among economists, legal scholars, and political strategists.

In a geopolitical climate already brimming with economic nationalism, technological rivalry, and diverging worldviews, the United States' recent diplomatic overture to China concerning the renegotiation of tariffs marks a pivotal moment in the global economic order. On May 1, 2025, Chinese state media-affiliated account Yuyuan Tantian reported that the U.S. government had initiated discussions with Beijing regarding the severe tariffs imposed during the Trump administration, some of which remain as high as 145%. The outreach, though informal and lacking official confirmation, carries profound implications for the future of U.S.–China relations and the world economy.