Trump rekindles trade war, threatens to impose another 100% tariff on China

 US President Donald Trump on Friday rekindled the trade war against Beijing. Ending months of uneasy truce between the world's two largest economies, he said the US would raise import tariffs in retaliation for China's curbs on key mineral exports.

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Trump announced that an additional 100% tariff would be imposed on goods imported from China. Currently, there is a 30% tariff. As a result, the total tariff rate will be 130%. In addition, controls will be imposed on all types of important software exports. These will be implemented from November 1. He made this announcement 9 days before the existing tariff moratorium expires.

Trump also said that the meeting with Chinese President Xi Jinping in South Korea, which was scheduled to take place in three weeks, is now uncertain. Trump wrote on his social media site Truth Social, "Now it seems that the meeting is no longer meaningful."

However, Trump told reporters at the White House, "I have not canceled the meeting yet, it may happen." China, however, has never confirmed the meeting.

China has made this decision in the context of imposing stricter controls on the export of rare earth metals. China is the main supplier of rare earth metals in the world. This rare mineral metal is essential for today's technological revolution. The main driving force of the artificial intelligence revolution that is happening in the world is chips or semiconductors. This rare mineral is essential for the production of those chips. Along with this, other electronic devices also need these chips.

This incident has again caused a major breakdown in Washington-Beijing relations after six months. Many are now questioning whether the temporary economic agreement that was reached after Trump came to power will survive at all.

 Analysts say that if the United States imposes restrictions on software exports to China, it will be a major blow to the country's cloud computing and artificial intelligence industries. Trump has also threatened to control exports of aircraft and parts. The administration is also said to be identifying new targets.

Beijing has always condemned the United States' unilateral trade controls. They believe that this is weakening the global trading system.

Market collapse, global economy in uncertainty

Trump's announcements have not only shaken the relationship between the world's two largest economies, but also caused a major shock to the market. Currently, China produces more than 90 percent of the world's processed rare metals and magnets. These expensive materials are used in products such as electric cars, aircraft engines and military radar.

After Trump's sudden announcement, the S&P 500 index of the US stock market fell more than 2 percent. This is the biggest decline since April. Investors have turned to gold and US Treasury bonds as safe havens. As a result, the dollar has weakened against other currencies. In addition, the price of shares in the technology sector also fell in the subsequent trading session.

Analyst Craig Singleton said that Trump's announcement may be the beginning of the end of the tariff truce. According to him, Washington sees the issue of controlling China's rare mineral exports as a kind of betrayal—Beijing may be playing too much with its own cards.

Trump claimed that China is sending letters to various countries saying that they will impose export controls on every component related to the production of rare metals. He said, "Several countries have told me that they are angry with China's move."

'Hostile directive', Trump blames China

Trump has called China's move a 'hostile directive'. He said, "We have to build up a financial resistance in response to their move. “We have two options for the materials they want to monopolize.”

Neither the White House nor the Chinese embassy in Washington commented on the matter. The US Trade Representative’s office and the Treasury Department also did not respond.

The Trump administration had previously proposed new restrictions on Chinese airlines, aimed at preventing Chinese planes from using Russian airspace to fly to the United States. The same day, the US Federal Communications Commission said major online retailers had removed millions of banned Chinese electronics products from its list.

China on Thursday added five new metals and related processing technologies to its list of export bans. Even foreign companies that use Chinese raw materials will have to comply with the new rules.

Analysts say the situation has become more complicated ahead of a possible Trump-Ci meeting on the sidelines of the Asia-Pacific Economic Cooperation (APEC) summit in South Korea in late October.

 "Both sides think that if they increase the pressure, the other side will give in," said Scott Kennedy, an analyst with the China-US relationship. "Maybe they assume that there will be no agreement in APEC, and that is why they are building up their strength in advance for the next fight."

Just as Trump's threat to impose another 100% tariff on China has reduced imports from China, so too has a huge deficit in cryptocurrencies. As a result of this deficit, almost all cryptocurrency coins have suffered huge losses.