In a surprising twist in global trade dynamics, the United States, under President Donald Trump, has implemented a 90-day tariff pause on imports from most countries while simultaneously escalating tensions with China by raising tariffs on Chinese goods to a staggering 125%. This move, announced on April 9, 2025, has sent ripples through international markets, prompting varied responses from world leaders, economic shifts, and a flurry of diplomatic activity. Here’s an in-depth look at what this means, how China and other nations are reacting, and the negotiations unfolding as of April 10, 2025.
What Is the 90-Day Tariff Pause?
The 90-day tariff pause is a temporary suspension of steep “reciprocal” tariffs that President Trump initially imposed on dozens of countries, effective from April 9, 2025. These tariffs, which Trump branded as part of his “Liberation Day” trade policy, were designed to counter trade imbalances and perceived unfair practices by trading partners. However, after significant market volatility and pressure from business leaders, Trump authorized a rollback, capping tariffs at a universal 10% baseline for most nations for the next 90 days. This pause, however, explicitly excludes China, signaling a strategic pivot to focus economic pressure on Beijing.
Trump explained this shift during a press interaction, stating, “I did a 90-day pause for the people that didn’t retaliate because I told them ‘if you retaliate, we’re going to double it’ – and that’s what I did with China.” He also suggested the decision was influenced by market reactions, noting, “I thought that people were jumping a little out of line” and getting “yippy,” hinting at a desire to stabilize financial markets that had plummeted amid earlier tariff fears.
China Faces a 125% Tariff Increase
Unlike other nations granted reprieve, China faces an immediate tariff hike on its exports to the U.S., jumping from 104% to 125%, with the White House clarifying the total rate, including a prior 20% fentanyl-related levy, now stands at 145%. This escalation follows China’s retaliatory 84% tariffs on U.S. imports, effective April 10, 2025, intensifying a trade war between the world’s two largest economies. Trump justified this move on Truth Social, citing “the lack of respect that China has shown to the World’s Markets,” and expressed optimism about future outcomes, saying, “At some point, hopefully in the near future, China will realise that the days of ripping off the USA and other countries is no longer sustainable or acceptable.”
China’s Response.
China has responded with a mix of defiance and strategic countermeasures. Beijing swiftly imposed its 84% tariffs on U.S. goods, signaling it won’t back down. On X, posts from China Daily captured the sentiment: “Trump calls China ‘disrespectful’ and slaps more tariffs. China responds: ‘We are not afraid. We don’t back down.’” Another post from the outlet criticized U.S. reliability, stating, “The truth behind Trump’s ’90-day pause’ on tariffs: the US isn’t trustworthy,” while highlighting China’s efforts to strengthen ties with the EU, Japan, and South Korea.
China’s Foreign Ministry spokesman Lin Jian reinforced this stance, declaring, “Washington’s move to weaponize tariffs to exert pressure and seek selfish gain goes against the whole world and China will fight to the end if the US is determined to fight a tariff and a trade war.” Additionally, China has restricted imports of Hollywood films, a cultural retaliation aimed at U.S. soft power, with its National Film Administration citing declining domestic demand amid the trade spat.
Chinese President Xi Jinping also announced restrictions on the number of U.S. films permitted in Chinese theaters, citing the need to protect domestic industries amid what he called “unfair economic pressures.” This decision followed a series of tariff hikes imposed by the United States, which Xi indirectly referenced as a threat to global cultural exchange. In response, U.S. President Donald Trump dismissed the move with characteristic nonchalance, stating, “They can limit movies all they want—our films are still the best, and people will find a way to watch them.” The exchange underscored a broad economic standoff.
Negotiations with the U.S. and Other Countries
The 90-day pause has opened a window for negotiations, with over 75 countries reportedly reaching out to the U.S. to discuss trade terms. White House economic adviser Kevin Hassett noted, “More than a dozen countries have made offers to the United States,” indicating a flurry of diplomatic activity. Treasury Secretary Scott Bessent framed the pause as a deliberate tactic, saying, “This was his strategy all along, and that you might even say that he goaded China into a bad position, they responded.” The U.S. aims to prioritize talks with nations willing to negotiate “reciprocal” trade deals to reduce deficits, though specifics remain fluid.
Trump hinted at flexibility, telling reporters, “A deal can be made with everyone, a deal is gonna be made with China, a deal’s going to be made with every one of them and there will be fair deals for everybody.” However, with China, negotiations appear stalled, as Beijing demands “mutual respect” and accuses the U.S. of insincerity.
The global reaction to the tariff pause has been largely positive, tempered by cautious optimism. The European Union, a key U.S. trading partner, paused its own retaliatory tariffs—originally set for April 15—mirroring the U.S.’s 90-day timeline. European Commission President Ursula von der Leyen welcomed the move, stating on X, “We want to give negotiations a chance,” and affirmed the EU’s commitment to “constructive negotiations” with the White House.
Canadian Prime Minister Mark Carney called the pause a “welcome reprieve,” reflecting relief among nations fearing economic fallout. In contrast, the UK’s Prime Minister emphasized resilience, saying, “I’m clear that this is a change which isn’t, in my view, temporary and therefore we’ve got to do the margins of making sure we turbocharge our own economy,” despite ongoing talks with the U.S.
Australia, while benefiting from rising stock markets post-pause, is exploring deeper trade ties with the EU, with its trade minister revisiting a stalled free-trade agreement. This suggests a broader shift as nations hedge against U.S. tariff unpredictability.
Economic and Market Impacts
The tariff pause triggered a historic market rally, with the S&P 500 recording one of its biggest gains since World War II on April 9, 2025. Oil prices surged over 4%, rebounding from four-year lows, reflecting eased global trade fears. However, economists like Jason Furman warn that the 125% China tariff could negate this relief, predicting it “is probably more inflationary” than the original reciprocal tariffs, potentially driving up U.S. consumer costs, especially for goods like iPhones, 80% of which are assembled in China.
Trump’s tariff strategy blends economic nationalism with negotiation leverage. He acknowledged transition challenges during a cabinet meeting on April 10, saying, “We think we’re in very good shape… Again there will be a transition cost, transition problems, but in the end it’s going to be a beautiful thing.” His late-night Truth Social post basked in the market rebound: “What a day, but more great days coming!!!”
For China, the tariff hike risks a potential decoupling, with the World Trade Organization forecasting an 80% drop in U.S.-China goods trade—roughly $466 billion—if tensions persist. Meanwhile, the 90-day pause offers other nations a chance to reshape trade alliances, potentially isolating China further or pushing it to seek new partners.
The 90-day tariff pause and 125% China tariff hike mark a pivotal moment in global trade. While the U.S. leverages this period to negotiate with willing partners, China’s defiance and retaliatory measures signal a deepening rift. As markets stabilize and talks unfold, the next three months will test Trump’s trade vision and the resilience of international economic ties.
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