Global Trade War Escalates: Trump Dismisses Market Panic and Touts "Get Rich" Opportunity
President Trump’s Tariffs Spark Global Retaliation
President Donald Trump goaded a "panicked" China on Friday after the chief US economic rival retaliated against his tariffs and he dismissed stock market panic over the growing global trade war, touting the chance to "get rich."
"China played it wrong, they panicked — the one thing they cannot afford to do!" Trump posted on Truth Social, writing the message in his trademark all-caps.
Market Volatility Continues
For a second day, markets plunged, wiping vast sums off investment and retirement portfolios alike.
Wall Street opened with steep selloffs, both the Dow Jones and S&P 500 losing close to three percent. Frankfurt and London sank more than four percent, while Tokyo’s Nikkei closed 2.8 percent down.
Trump Unrepentant
Trump, who unveiled his barrage of import duties against countries all over the world on Wednesday, was unrepentant, posting that "my policies will never change."
"This is a great time to get rich, richer than ever before," he wrote.
China Responds with Tariffs and WTO Lawsuit
However, China responded toughly, announcing its own new 34 percent tariffs on US imports starting April 10.
Beijing said it would sue the United States at the World Trade Organization and also restrict export of rare earth elements used in high-end medical and electronics technology.
EU and Other Trading Partners Hold Back
Other big US trading partners have so far held back as they digest the unfolding international standoff and fears of recession.
EU trade chief Maros Sefcovic was due to speak with US counterparts on Friday.
Sefcovic said the EU, which Trump hit with a 20 percent tariff, will act in "a calm, carefully phased, unified way" and allow time for talks. However, he also warned the bloc "won’t stand idly by, should we be unable to reach a fair deal."
EU Examines Options
France and Germany have said the 27-nation EU could respond by imposing a tax on US tech companies.
Economy Minister Eric Lombard urged French companies to show "patriotism" after President Emmanuel Macron argued it would send the wrong message if they pressed ahead with investments in the United States.
Lombard said the EU’s retaliation would not necessarily involve tit-for-tat tariffs and could use other tools, pointing to data exchange and tax as levers that could be used.
"The response can be very strong? but we should not respond with exactly the same weapons the US used as, if we do, it can also have a negative effect in Europe," he told news network BFMTV.
Cars Clash
Separate US tariffs of 25 percent on all foreign-made cars also went into effect this week, and Canada swiftly responded with a similar levy on US imports.
Stellantis — the owner of Jeep, Chrysler and Fiat — paused production at some Canadian and Mexican assembly plants.
Japanese carmaker Nissan said on Friday it would revise plans to reduce production in the United States.
The company also said it would stop selling two vehicle models on the US market that are made at a factory in Mexico.
Sweden’s Volvo Cars, owned by China’s Geely, said it would increase its production of vehicles in the United States and probably produce an additional model there.
Commerce Secretary Urges Patience
Amid howls of protest abroad, and even from some of Trump’s Republicans who fear price rises at home, Commerce Secretary Howard Lutnick urged patience.
"Let Donald Trump run the global economy. He knows what he’s doing," Lutnick said on CNN.
Conclusion
The global trade war is escalating, with the US, China, and other countries imposing tariffs and retaliating against each other. While Trump remains unrepentant, other trading partners are holding back and examining their options. The outcome of this trade war is uncertain, but one thing is clear: the world is bracing for a period of economic uncertainty.
FAQs
Q: What are the tariffs imposed by the US on China and other countries?
A: The US has imposed tariffs of up to 25% on a wide range of goods from China, including electronics, clothing, and furniture. Other countries, including Canada and the EU, have also imposed retaliatory tariffs on US goods.
Q: What are the tariffs imposed by China on the US?
A: China has imposed tariffs of up to 34% on US goods, including soybeans, corn, and pork.
Q: How is the global economy affected by the trade war?
A: The trade war is expected to slow down global economic growth, as the tariffs imposed by the US and China disrupt global supply chains and lead to price increases for consumers.
Q: What is the impact on US businesses and consumers?
A: The tariffs imposed by the US and China are expected to increase costs for US businesses and consumers, particularly those in the manufacturing and agricultural sectors.