Trump’s 104% Tariffs and China’s 84% Retaliation: Global Trade War and the African Market Fallout

In a move shaking the global economic order, Trump’s 104% tariffs on Chinese goods took effect on Wednesday, April 9th, 2025. This has triggered a fierce response from Beijing, which announced an 84% retaliatory tariff on U.S. exports. This significant escalation in the trade war has not only rattled Wall Street and Asian markets but also raised concerns over ripple effects in emerging economies, particularly across Africa.

Trump’s 104% Tariffs: A Policy of “Reciprocal Punishment”

Announced by White House Press Secretary Karoline Leavitt, Trump’s 104% tariffs aggressively expand the administration’s longstanding protectionist trade agenda. What started as a 10% blanket tariff on all Chinese imports earlier this year has now morphed into an economic hammer designed to counter what Trump calls China’s “economic aggression.”

Initially set to rise by 34%, the tariffs surged an additional 50% following China’s refusal to back down on its promise to slap U.S. goods with an 84% tariff. This means Trump’s 104% tariffs represent a sudden, unprecedented jump in trade barriers, drastically affecting everything from smartphones and toys to critical manufacturing components.

Adding fuel to the fire, Trump signed an executive order eliminating tariff exemptions for goods under $800, targeting budget-friendly imports from platforms like Shein, Temu, and AliExpress. This resulted in an imminent price hike on goods for American consumers and increased operational costs for businesses reliant on Chinese manufacturing.

According to the White House, the tariffs will be enforced from 5 a.m. on Wednesday, the 9th of April, 2025, following Trump’s renewed threats to escalate the trade conflict. Leavitt confirmed during a press conference:

“It will be going into effect at 12.01 a.m. tonight. So effectively tomorrow.”

When asked if Trump was open to negotiating with Chinese President Xi Jinping, Leavitt stated:

“China has to make a deal with the U.S. It was a mistake for China to retaliate. When America is punched, he punches back harder.”

Earlier, Trump had warned via Truth Social:

“If China does not withdraw its 34% increase above their already long-term trading abuses by tomorrow, April 8th, 2025, the United States will impose ADDITIONAL Tariffs on China of 50%, effective April 9th.”

If implemented, this would compound prior penalties, like a 20% tariff targeting fentanyl trafficking and the 34% increase announced last week, bringing the total to 104% on Chinese imports.

READ ALSO: U.S. Tariff Surge Sparks Global Trade War: Who Wins, Who Loses?

China Retaliates: 84% Tariffs and Strategic Countermeasures

Beijing has responded with equal intensity. Branding Trump’s move as “a mistake upon a mistake,” China’s Commerce Ministry vowed to “fight to the end.” Their retaliation includes:

• 84% tariffs on U.S. agricultural products such as soybeans and poultry
• A potential ban on U.S. films and entertainment
• Restrictions on American legal and consulting services
• Suspension of fentanyl cooperation agreements
• Investigation into American intellectual property earnings

China labeled the U.S. action a “typical unilateral bullying practice,” dismissing Washington’s justification as “completely groundless.” The Commerce Ministry warned:

“If the US insists on its way, China will fight to the end… to safeguard its sovereignty, security, and development interests.”

Prominent Chinese commentators and state media figures fueled the fire, sharing possible countermeasures, including banning U.S. poultry imports, restricting legal and consultancy services, and suspending fentanyl cooperation.

“China does not provoke trouble, but it is not afraid of it either,” wrote Liu Hong, a senior editor at Xinhua News Agency.

Global Market Reactions and the Risk of Recession

Following the announcement of Trump’s 104% tariffs, global markets responded with immediate volatility:

• Dow Jones plunged 320 points
• S&P 500 slid 1.57%
• Nasdaq dropped 2.15%
• Japan’s Nikkei fell 3%
• Hong Kong’s Hang Seng tumbled 3%
• Australia and South Korea indices declined by about 1%

Though the FTSE 100 saw a modest rise of over 1% on Tuesday morning, analysts cautioned that Trump’s threats could lead to sustained instability and recession risks. U.S. Treasury Secretary Scott Bessent echoed this concern, calling Beijing’s escalation “a big mistake.”

Economist Xu Tianchen of the Economist Intelligence Unit commented:

“Since China already faces a tariff rate over 60%, it doesn’t matter if it goes up by 50% or 500%.”

Meanwhile, dozens of other countries, including EU member states, face similar midnight deadlines for revised U.S. tariffs ranging from 11% to 50%. Leavitt confirmed that Trump has instructed trade negotiators to craft “tailor-made” deals for nations willing to negotiate, stressing they won’t be “off-the-rack.”

Implications for Global Prices and Consumer Markets

The sharp escalation of tariffs, 104% on Chinese goods and 84% on U.S. exports, has far-reaching implications for global consumer prices. As the cost of importing goods rises dramatically, companies will be forced to either absorb the added expense or pass it on to consumers. In most cases, the latter is more likely, and this could lead to widespread inflation across global markets.

1. Price Hikes Across Consumer Goods

Consumers should brace for a surge in retail prices, from smartphones and household electronics to toys and clothing. Removing tariff exemptions for low-cost imports from platforms like Shein, Temu, and AliExpress will directly hit the wallets of budget-conscious shoppers, particularly in the U.S. and Europe. Retailers relying on Chinese supply chains must adjust pricing strategies, potentially affecting demand and sales volumes.

2. Raw Material and Input Cost Inflation

Manufacturers worldwide, especially in developing nations, rely on Chinese components and raw materials. With higher tariffs in play, the cost of these inputs will increase, which could push inflation that impacts both the producers and end-users of goods. This could disrupt everything from automobile manufacturing to pharmaceuticals and agricultural equipment production.

3. Chain Reactions in the Global Supply Chain

As U.S. and Chinese firms reroute supply chains to avoid tariffs, logistical bottlenecks may arise. New routes through Southeast Asia, Latin America, and Africa could cause temporary shortages and delays, pushing prices even higher due to scarcity and increased shipping costs.

4. The burden on Low-Income Economies

Emerging markets in Africa and parts of Asia will likely face the brunt of global price volatility. With limited fiscal buffers and weaker currencies, governments and households in these regions will struggle to afford essential imports, including food, energy, and medical supplies. If inflation becomes unmanageable, the ripple effect may fuel social unrest and economic instability.

5. Market Uncertainty and Hoarding Behavior

Speculative buying, stockpiling, and hoarding of high-demand products may become more common as markets respond to uncertainty. This behavior can create artificial shortages and increase prices, especially for everyday items like electronics, packaged foods, and medicines.

How Africa Might Be Affected by the U.S.-China Trade War

While Africa isn’t a direct combatant in this economic conflict, it is a collateral casualty. Here’s how the continent might feel the heat from Trump’s 104% tariffs and China’s 84% counterblow:

1. Disruption of Global Supply Chains: Many African economies rely on China for machinery, electronics, and industrial goods. Tariff-driven cost increases and slowed manufacturing in China could raise import prices for African businesses, especially in manufacturing, agriculture, and telecommunications.
2. Commodity Export Risks: China is a key buyer of African raw materials, including copper, cobalt, and oil. As Trump’s 104% tariffs begin to squeeze China’s economy, its commodity demand could fall, affecting African export revenues.
3. Shifting Investment Patterns: With global firms seeking alternatives to China, Africa might become a more attractive investment destination. However, political instability and infrastructure gaps may limit the continent’s ability to absorb large-scale shifts in global manufacturing.
4. Increased Inflation: As prices rise globally due to the trade war, imported goods in African markets will also become more expensive. This inflation could hit consumers hard, particularly in nations battling currency depreciation and debt.
5. Opportunities for Strategic Alliances: Some African countries could benefit from new trade alliances, particularly if the U.S. or China seeks to strengthen alternative partnerships. The African Continental Free Trade Area (AfCFTA) could become a vital platform for mitigating risks and harnessing new opportunities.

Trade Tyranny or Strategic Brilliance?

Trump’s 104% tariffs represent a gamble with profound consequences for the U.S., China, and the entire global economic system. While aimed at correcting perceived trade imbalances, the aggressive move risks sparking long-term instability, with developing regions like Africa vulnerable to the fallout.

As the dust settles, policymakers worldwide must navigate this volatile landscape with caution. For Africa, the challenge lies in preparing for economic shocks while seizing any strategic advantages that might arise from restructuring global trade routes.