China has vowed to fight to the end in its ongoing trade war with the United States, responding to new US tariffs with its own countermeasures. As tensions rise, both nations continue imposing economic restrictions, affecting global markets and supply chains.
China Rejects US Tariff Hikes
The Chinese Embassy in Washington declared that Beijing is ready for a prolonged trade battle. The statement came after the US announced a 10% tariff on all Chinese imports, citing concerns over fentanyl. China dismissed this reasoning, calling it a weak excuse for economic pressure.
The US tariffs target hundreds of billions of dollars worth of Chinese goods. In response, Beijing imposed levies of up to 15% on key US agricultural exports like soybeans, pork, and wheat. Officials stated that China will defend its economic interests with necessary countermeasures.
Economic Impact and Market Reactions
Stock markets in Asia rebounded following an initial dip due to the US tariff announcement. Despite the ongoing trade war, China’s exports reached record levels last year, showing resilience. However, experts warn that continued escalation could slow global trade and economic growth.
Analysts describe China’s current response as restrained, suggesting stronger retaliatory measures could follow if tensions persist. Some predict Beijing will introduce new policies this week to stabilize its economy and counter the impact of US restrictions.
China Targets Domestic Growth Amid Trade War
Despite trade tensions, China set an ambitious 5% economic growth target for 2025. Premier Li Qiang outlined plans to boost domestic demand, making it the primary driver of economic expansion. The government also announced a fiscal deficit increase to 4%, providing more funds for economic recovery.
China’s strategy includes:
- Creating 12 million new jobs in urban areas
- Encouraging consumer spending to strengthen economic stability
- Supporting industries affected by trade restrictions
However, experts believe low consumer confidence remains a challenge. Concerns over employment, wages, and real estate continue to limit spending. Without stronger government intervention, economic growth may remain sluggish.
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Rising Tensions and Military Spending
China also increased its defense budget by 7.2% for 2025, highlighting regional tensions and competition with the US. The funds will support military operations around Taiwan, a key point of friction between Beijing and Washington.
The spending hike follows US proposals to cut global military budgets, which China has not accepted. Beijing insists that any reductions should start with Washington. Meanwhile, online discussions in China call for even higher defense spending to strengthen national security.
What’s Next?
With both nations refusing to back down, the trade war is far from over. China’s focus on domestic economic stability and strategic countermeasures suggests a long-term standoff. As global markets react, businesses and consumers worldwide will feel the impact of these economic battles.
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