Trade & Tariffs
How the world's largest trading relationship became an economic battlefield.
China and the United States are each other's largest trading partners — and increasingly, economic adversaries. What began as a dispute over trade deficits and intellectual property has evolved into something broader: a contest over technology, supply chains, and economic influence. Tariffs that were supposed to be temporary are now permanent features of the relationship.
The Trade Relationship
Despite tariffs and tensions, China remains America's third-largest trading partner (after Canada and Mexico) and its largest source of imports. The deficit — a persistent political flashpoint — has narrowed from its 2018 peak but remains substantial.
What Gets Traded
🇨🇳 → 🇺🇸 Top US Imports from China
- Electronics & electrical equipment $122B
- Machinery & mechanical appliances $97B
- Furniture, toys, misc. goods $52B
- Textiles & apparel $32B
- Plastics & rubber $19B
🇺🇸 → 🇨🇳 Top US Exports to China
- Soybeans & agricultural products $26B
- Semiconductors & electronics $18B
- Oil & gas $15B
- Aircraft & parts $12B
- Vehicles & auto parts $11B
How We Got Here
The current trade conflict didn't happen overnight. It built over years of complaints about intellectual property theft, forced technology transfer, and industrial subsidies — then exploded into open tariff warfare.
US Action Solar panel & washing machine tariffs
Trump administration imposes tariffs under Section 201, signaling willingness to use trade tools aggressively.
US Action Section 301 investigation completed
USTR finds China guilty of IP theft and forced tech transfer. Justification for broad tariffs established.
Tariffs take effect — both sides
US imposes 25% tariffs on $34B of Chinese goods. China retaliates immediately with matching tariffs on US goods including soybeans and cars.
Third round of tariffs
US adds $200B in Chinese goods at 10%. China responds with tariffs on $60B of US goods. Trade war now covers majority of bilateral trade.
US Action Huawei blacklisted
Commerce Dept adds Huawei to Entity List. Trade conflict expands into technology and national security sphere.
"Phase One" deal signed
China commits to $200B in additional US purchases. US suspends some tariff increases. Structural issues unresolved. Deal largely unfulfilled.
US Action Biden maintains tariffs
New administration keeps Trump-era tariffs in place. Reviews ongoing but no major rollbacks. Bipartisan consensus on China hawkishness.
US Action EV and clean energy tariffs
100% tariffs on Chinese EVs, plus increases on batteries, solar cells, steel, aluminum. Focus shifts to protecting emerging US industries.
China Response Critical minerals banned
China bans export of gallium, germanium, antimony to US. Signals willingness to weaponize supply chain dominance.
Current Tariff Rates
After years of escalation, tariffs on both sides now cover the majority of traded goods. Some categories face tariffs of 100% or more, reinforcing existing market barriers.
US Tariffs on Chinese Goods (Selected Categories)
What Comes Next
The trade relationship has fundamentally changed. Neither side shows interest in returning to pre-2018 norms. Instead, both are preparing for a future of managed competition and reduced interdependence.
- Decoupling: Both countries actively reducing reliance on each other. US "friend-shoring" to allies; China building domestic supply chains.
- Third-country routing: Chinese goods increasingly shipped through Vietnam, Mexico, and other countries to avoid tariffs — partially undermining the restrictions.
- Tech bifurcation: Export controls and tariffs creating separate technology ecosystems. Companies forced to choose sides or maintain duplicate supply chains.
The era of US-China economic integration — which lifted hundreds of millions out of poverty and made consumer goods cheaper for Americans — appears to be ending. What replaces it remains uncertain.