The United States government has reversed its recently implemented counter-tariffs. Current trade measures include a 10% tariff on imports from most nations, excluding Canada and Mexico due to USMCA compliance. Automotive, steel, and aluminum sectors remain subject to a 25% tariff. Commerzbank’s FX analyst Volkmar Baur highlights that China faces a significantly elevated tariff burden of 145% beyond pre-existing levels.
A sustained resolution to trade tensions remains elusive. The core issue lies in the geopolitical rivalry between the US and China, where economic security is prioritized over economic cooperation. Both nations are actively pursuing economic independence, particularly in strategically vital supply chains, and seeking technological dominance. Consequently, sanctions and trade restrictions are expected to persist.
Specifically, the US is concerned by several factors. Primarily, China’s manufacturing output surpasses the combined output of the next nine largest manufacturing nations. In 2020, China accounted for 35.4% of global manufacturing output, while the US held an 11.8% share.
