US-China Trade War Escalates: Tariffs, Retaliation & Economic Impact

The United States and China, two economic powerhouses with a combined GDP of $50 trillion, are locked in an unprecedented trade war. What started as a series of tit-for-tat tariff announcements has escalated into one of the most intense economic confrontations in modern history. President Donald Trump initiated new tariffs on Chinese imports in February 2025, sparking immediate retaliation from China. From coal and LNG to agricultural machinery, both nations have targeted key industries to maximize their leverage. By April 2025, the U.S. imposed a staggering 125% tariff on Chinese goods, while China responded with 84% tariffs and restrictions on rare earth exports. This escalating conflict isn’t just about tariffs—it’s reshaping global trade dynamics. With China calling out the U.S. for “arrogant and bullying behaviour” and Trump insisting that Beijing wants a deal but doesn’t know how to proceed, tensions remain high. Beyond trade, issues like TikTok ownership and China's influence over the Panama Canal add further complexity to this geopolitical showdown. Will these two superpowers find common ground or continue down a path of economic warfare?