In 2025, the US-China tariff war escalated: President Trump announced a 145% tariff, and China swiftly retaliated, impacting global supply chains.

In April 2025, the US-China trade war escalated as President Trump imposed a 145% tariff on Chinese goods, and China retaliated by raising tariffs on US goods to 125%. This tariff war impacted global supply chains, technology policies, and geopolitics. The US tried to form a tariff alliance, while China bolstered its cooperation with ASEAN and the EU. The confrontation in the tech sector intensified, leading companies to reevaluate their supply chains. Taiwan and the US initiated tariff negotiations, and other countries, such as India and Vietnam, actively sought to attract US companies to move their production bases.

US Policy: Reciprocal Tariffs and Global Pressure

In April 2025, President Trump of the United States announced a 145% tariff on Chinese goods and implemented a "reciprocal tariff" policy affecting 75 other countries, with rates ranging from 11% to 50%. However, he later announced a 90-day suspension, maintaining high tariffs only on China. The White House stated that this move aims to correct the trade deficit, revitalize American manufacturing, and emphasized that China is the "biggest abuser."

The Trump administration's strategy targets not only China but also seeks to establish a "tariff alliance," negotiating with allies including Taiwan, Japan, South Korea, and Australia. White House trade advisor Navarro stated that 90 agreements will be completed within 90 days, indicating the US's intention to establish a new global trade order.

China's Countermeasures: Tariff Retaliation and Multi-pronged Approach

China responded swiftly by raising tariffs on US goods from 34% to 84% as of April 10, and further increasing them to 125% on April 11. Chinese Commerce Minister Wang Wentao pointed out that the US tariff policy will severely harm developing countries and announced plans to file a lawsuit with the World Trade Organization (WTO).

In addition to tariffs, China has taken several countermeasures, including:

• Listing 12 US companies on the export control list;
• Adding 6 companies involved in Taiwan arms sales to the unreliable entity list;
• Restricting imports of US agricultural products and services;
• Halting cooperation with the US in the fentanyl field.

China's State Council also held a "Central Peripheral Work Conference," emphasizing strengthening economic cooperation with ASEAN and the EU to maintain international trade circulation.

Economic Structure Adjustment and Internal Response

Since the trade war erupted in 2018, China has been promoting the "Made in China 2025" initiative to enhance technological self-reliance. According to Chinese state media and former Global Times editor Hu Xijin, China has made significant progress in fields such as chips, electric vehicles, drones, robotics, and AI applications, forming a resilient supply chain.

The US, through tariffs and export controls, limits China's development in high-tech fields, particularly semiconductors and AI chips. Although US companies like Apple, Tesla, and Amazon have begun adjusting their supply chains, shifting some production to India or Southeast Asia, the US-China economy remains highly interdependent, and the decoupling process is fraught with challenges.

Global Supply Chain Restructuring and Geopolitical Changes

The US-China tariff war has led to a restructuring of the global supply chain. According to official Taiwanese data, Taiwan's share of exports to the US rose to 25.5% in 2024, while its share to China and Hong Kong fell to 28.4%, the lowest in 24 years. Japan and South Korea have shown similar trends, indicating that export-oriented economies are gradually "de-Sinicizing."

While US companies face risks in the Chinese market, a survey by the American Chamber of Commerce and the Corporate Legal Counsel Association shows that about 70% of companies still plan to maintain or expand their operations in China. This reflects the dilemma between market opportunities and political risks.

The EU and ASEAN have adopted a wait-and-see attitude. The EU has postponed retaliatory tariffs on US steel and aluminum, while ASEAN member states have pledged not to retaliate against the US. China is trying to woo Europe and neighboring countries, but with limited success.

Technology Policy and Origin Recognition Disputes

In the technology sector, US-China competition has extended to origin recognition and tariff application standards. China has eased origin recognition rules to mitigate the impact on domestic companies. The US, however, emphasizes that even US chips packaged in China will still be taxed, indicating an intensifying confrontation in technology policy.

For example, products from US IDM manufacturers like Intel and Texas Instruments, if recognized as US origin, will face tariffs as high as 125% in China. This prompts companies to reassess production and packaging locations, further driving supply chain restructuring.

Taiwan and Other Countries' Responses

Taiwan has begun tariff negotiations with the US, seeking to reduce the current 10% tariff to zero. President Lai Ching-te of Taiwan stated that Taiwan is on the US's initial negotiation list and emphasized the importance of protecting exporters. In 2024, Taiwan's trade surplus with the US reached $73.9 billion, with about 60% being semiconductors and ICT products.

Other countries like India, Vietnam, and Mexico are also actively attracting US companies to shift their supply chains, becoming potential alternative production bases.

References

• 中國將再次大爆發？　胡錫進親曝「2018年中美貿易戰結局」 | ETtoday大陸新聞 | ETtoday新聞雲
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• 川普對中關稅加到145%，習近平回敬125％！美中有何底氣與策略博弈？ - TNL The News Lens 關鍵評論網
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