China is rallying the world to stand against former U.S. President Donald Trump’s sweeping new tariffs, which have delivered a major blow to Chinese exporters—some now facing levies as high as 104%.
“Global unity can triumph over trade tyranny,” declared an editorial in the state-run China Daily, citing Beijing’s increasing cooperation with countries such as Japan, South Korea, and other Asian economies. In a separate article, the paper called on the European Union to join China in defending “free trade and multilateralism.”
Beijing has made its stance clear. “China firmly opposes and will never accept such hegemonic and bullying practices,” said foreign ministry spokesperson Lin Jian during a press briefing on Wednesday.
Trump’s new tariffs come at a vulnerable time for China’s economy. With domestic consumption still weak, exports remain a vital engine for growth. But the wide-ranging scope of the new tariffs has left Chinese companies scrambling, with little room to reroute supply chains.
“This will shrink already razor-thin profit margins,” said the owner of a Chinese logistics business dealing in cross-border e-commerce and international freight. He requested anonymity. “Higher tariffs raise costs for freight forwarders like us, as well as for factories, companies, and sellers. It just means everyone earns less.”
“Full-On Decoupling”
Analysts warn that tariffs over 35% could wipe out all profits for Chinese exporters. “Growth is going to be much lower since exports contributed to 20% to 50% of growth since the Covid pandemic,” said Dan Wang from the Eurasia Group consultancy.
So far, China has not announced retaliatory measures. However, according to Chinese blogger Liu Hong—also a senior editor at the state-run Xinhua news agency—Beijing is considering banning Hollywood films and halting cooperation with the U.S. on fentanyl issues.
Such moves may do little to help firms like Fuling, a Chinese manufacturer of disposable tableware that supplies major U.S. fast food chains like McDonald’s and Wendy’s. The company stated that the additional tariffs will “significantly impact” its business, which drew nearly two-thirds of its revenue from the U.S. in 2023 and the first half of 2024.
In response, Fuling opened a new factory in Indonesia in late 2024—but Trump’s new tariffs apply there too. Chinese exports from Indonesia now face a 32% levy, the company revealed in a corporate filing.
A Blow to Global Trade
Indonesia is one of many countries caught in Trump’s expanded tariff regime, which he claims will boost the American economy. But economists have sounded alarms over the potential for a global recession, and the tariffs have already shaken international markets.
Even some of Trump’s allies have spoken out. Billionaire Elon Musk, among others, has criticized the sweeping measures.
Under the new policy, most foreign imports to the U.S. face a 10% baseline tariff. Higher rates target what Trump calls the “worst offenders”: Cambodia (49%), Vietnam (46%), and Thailand (36%)—countries that had become key manufacturing alternatives for many Chinese businesses.
After China responded with reciprocal tariffs, Trump doubled down, raising duties on Chinese imports to a staggering 104%.
A Chinese logistics company owner told the BBC he hopes Beijing can negotiate a reduction. “Only when a final decision is made can we plan our next steps,” he said.
Trump has not spoken to Chinese President Xi Jinping since returning to the White House, but Beijing has left the door open for dialogue.
U.S. Businesses Also on Edge
The American Chamber of Commerce in China expressed concern about the fallout. In a note to its members, Chair Alvin Liu and President Michael Hart wrote: “This level of upheaval is unprecedented, and it remains unclear how the current measures will benefit consumers in either nation or the broader economy.”
Some analysts believe the tariffs will eventually force China to restructure its economy and strengthen domestic demand—a long-standing challenge for the country.
Otherwise, said Tim Waterer from brokerage firm KCM Trade, “the tariffs will not be sustainable for China in the longer term.”
A Chinese freight manager echoed that sentiment. “The tariffs are aimed at suppressing China,” he said, adding that many of the Southeast Asian countries hit by steep U.S. tariffs—such as Vietnam and Cambodia—are exactly where Chinese companies had relocated their production lines.
His Tianjin-based company is now negotiating with American clients to split the cost burden. “Every case is different, but overall, the impact has been quite substantial,” he added.
Trade Comes to a Halt
Wu Changchun, general manager of Maritima Maruba, a shipping firm operating between China and Cambodia, said freight volumes are already dropping. Some construction projects in Cambodia have also stalled since Trump’s tariff announcement.
“If the tariffs were at 10% or 20%, businesses might still be able to absorb the cost by optimising supply chains, cutting margins and sharing the burden,” Wu explained. “Trade could still go on… [But at 104%] that’s no longer something trade-offs can fix.”
He added grimly: “That’s full-on decoupling. Trade would basically come to a standstill.”
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