China has announced a new 34% tariff on all U.S. goods, starting from April 10. This move is a direct response to the latest round of trade duties introduced by President Donald Trump. The announcement, made by China’s Finance Ministry on Friday, signals a major step up in the ongoing trade conflict between the two largest economies in the world.

At the same time, China will also begin placing export restrictions on several important medium and heavy rare-earth elements — including samarium, gadolinium, terbium, dysprosium, lutetium, scandium, and yttrium — from April 4. These rare-earth materials are vital for producing advanced technology and defense equipment. “The purpose of the Chinese government’s implementation of export controls on relevant items in accordance with the law is to better safeguard national security and interests, and to fulfil international obligations such as non-proliferation,” China’s Commerce Ministry said in a statement. China has put 11 more foreign companies on its "unreliable entity" list, which means it can now take strict action against them. This shows that China is prepared to use laws and economic tools to respond to pressure from the United States.

At the same time, China’s State Council Tariff Commission made it clear that goods already on their way will not be affected by the new tariffs. “If the goods have been shipped from the place of departure before 12:01 on April 10, 2025, and are imported between 12:01 on April 10, 2025, and 24:00 on May 13, 2025, the additional tariffs prescribed in this announcement will not be levied," it added. Beijing made the decision a day after warning of "countermeasures to safeguard its own rights and interests" and urging Washington to lift its most recent tariffs. Earlier this week, Trump announced that Chinese goods would now face a total tariff of 54%, which includes a new 34% tax added on top of a 20% tariff already in place from earlier this year. This total increase is close to the 60% tariff he talked about during his presidential campaign.

Along with this, a basic 10% tariff on almost all imports — not just from China but from other countries too — will start this Saturday. The higher "reciprocal tariffs" that are specifically for Chinese imports will begin on April 9. President Trump signed an executive order to close the "de minimis" loophole—a rule that let low-cost packages from China and Hong Kong enter the U.S. without paying taxes or duties. Ending this rule is likely to affect e-commerce shipments and small businesses that depend on international deliveries. This move adds to the growing tension as U.S. trade officials review whether China has followed through on its promises in the 2020 “Phase 1” trade deal. As part of that agreement, China had agreed to buy $200 billion more in U.S. goods over two years. However, China has not met those goals, pointing to the COVID-19 pandemic and global supply chain problems as reasons.

Even with rising tensions, the economic relationship between the U.S. and China remains strong. According to Chinese customs data, China imported $154 billion in U.S. goods back in 2017, before the trade war. By 2024, that number had grown to $164 billion, showing that trade between the two countries continues despite policy disagreements.