The US-China tariff war, which began in 2018 under the Trump administration, represents one of the most consequential economic conflicts in recent history. What started as an effort to address trade imbalances and protect domestic industries quickly escalated into a full-blown trade war, with both nations imposing successive rounds of tariffs on hundreds of billions of dollars worth of goods.
Today, the legacy of the tariff war persists in the form of lingering tariffs, strained US-China relations, and a more fragmented global trade system. As both nations navigate an era of strategic competition, the lessons from this economic conflict underscore the risks of protectionism and the challenges of managing interdependence in an increasingly polarized world.
Is this the first time Trump waging a war with Tariffs ?
No.
Donald Trump served as U.S. president from 2016 to 2020.
Early in his term, in January 2018, he imposed tariffs on imported solar panels and washing machines, without specifying particular countries—though China, the leading global producer of solar panels, was significantly affected.
While the immediate goal was to gain economic leverage, the prolonged dispute ended up reshaping global trade dynamics, disrupting supply chains, and imposing significant costs on businesses and consumers in both countries. Supply chains began shifting away from China, with countries like Vietnam, India and Mexico emerging as alternative manufacturing hubs.
By June 2018, he escalated the trade conflict by introducing 25% tariffs on over 800 Chinese goods.
China retaliated in April 2018 by imposing a steep 178.6% tariff on U.S. sorghum, though this was lifted the following month. Additionally, Beijing introduced 25% tariffs on 128 American products, including soybeans and aircraft.
Later that year, Trump expanded tariffs to include steel (25%) and aluminum (10%) from Canada, Mexico, and EU nations. These countries responded with their own countermeasures—for instance, Canada imposed 25% and 10% tariffs on various U.S. imports.
The trade tensions between the U.S. and China intensified from mid-2019 into 2020, with both sides repeatedly increasing tariffs while attempting to negotiate a resolution.
By 2019, Mexico had replaced China as America’s largest trading partner. A temporary truce was reached in January 2020.
When President Joe Biden took office in 2020, he maintained some of Trump’s trade policies, extending the solar panel tariffs in 2022. The washing machine tariffs, however, expired in February 2023.
How Tariffs Impact Specific Industries
Tariffs can reshape entire industries—some benefit from protection, while others suffer from higher costs or lost markets.
Example,
Impact of Tariffs:
- U.S. Tariffs on Chinese Tech (Laptops, Phones, Chips): The U.S. imposed tariffs on $200 Billion of Chinese tech imports, raising costs for Apple, Dell, and HP.
- Apple’s Shift to India & Vietnam: To avoid tariffs, Apple now makes 20% of iPhones in India (up from 1% in 2018).
While some industries benefited from protectionist policies, many economists argue that the trade war ultimately harmed both economies without resolving underlying disputes over intellectual property, market access, and state subsidies.
On an overall note,
Winners: Domestic industries (if competitive), alternative suppliers (Vietnam, India).
Losers: Consumers (higher prices), exporters (like farmers, manufacturers) hit by retaliation
New Possible trend: Companies may relocate supply chains to avoid tariffs (China → Mexico/India/Vietnam).
What is foreign tariff?
A foreign tariff (or import tariff) is a tax imposed by a country on goods and services imported from other nations. Governments use tariffs to control trade, protect domestic industries, and generate revenue.