Torsten Slok, chief economist at Apollo Global Management, discusses President Donald Trump’s threat to raise Chinese tariffs, his outlook for the economy and more on “Barron’s Roundtable.”
President Donald Trump on Sunday allayed fears of an escalating trade war with Beijing after threatening to impose 100% tariffs on The Chinese import in response to the country’s export restrictions on rare earth metals.
Trump’s new tariffs on China would amount to a large increase from the current average tariff of 55%.
In a post on Truth Social, Trump said China’s economic problems would “all work out for the best” and emphasized that the US wants to “help China, not hurt China.”
“Don’t worry about China, everything will be fine!” Trump wrote. “Highly respected President Xi just had a bad moment. He doesn’t want depression for his country, and neither do I. The US wants to help China, not hurt it!!!”
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Chinese President Xi Jinping speaks during an international business meeting at the Great Hall of the People on March 28, 2025 in Beijing, China; Right: President Donald Trump talks to reporters after signing an executive order: ‘Unleashing prosperi (Left: Ken Ishii – Pool/Getty Images; Right: Chip Somodevilla/Getty Images / Getty Images)
The mail came hours later China has given an official response on Trump’s threat to impose a 100% tariff on Chinese imports by November 1, warning Washington not to resort to “threats” and promising to “resolutely take corresponding measures” if the US goes ahead.
“China’s position is consistent,” the Commerce Ministry said in a statement on Sunday.
“We don’t want a tariff war, but we’re not afraid of it either.” The department urged the U.S. to address the differences “through dialogue,” calling repeated tariff threats “not the right way to deal with China.”
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Chinese President Xi Jinping applauds during the joint press conference of the China-Central Asia Summit in Xian, northern China’s Shaanxi province on May 19, 2023. (FLORENCE LO/POOL/AFP via Getty Images/Getty Images)
Beijing suggested it would retaliate against any new tariffs the US might impose on Chinese imports.
Sunday’s exchanges signaled a reversal in the trade truce between the world’s two largest economies.
Trump’s threat was initially prompted by new Chinese restrictions on exports of rare earths, or minerals crucial to advanced manufacturing and military technology.
China controls about 70% of global rare earth mining and nearly 90% of processing capacity.
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Vice President J.D. Vance speaks with Fox Business’ Maria Bartiromo in an interview appearing tomorrow on “Sunday Morning Futures.” (Fox Business / FOX Business)
“It’s going to be a delicate dance and a lot of it will depend on how the Chinese respond. If they respond in a very aggressive manner, I guarantee you the president of the United States has a lot more cards than the People’s Republic of China,” Vance said on “Sunday Morning Futures.”
Trump’s tariff threat and China’s response have also cast doubt on a meeting with Xi later this year.
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Chinas Ministry of Commerce said it would continue to issue export licenses for legitimate civilian uses of rare earths, but warned that “if the US side stubbornly persists in its practice,” Beijing would act to protect its interests.
