Tariff earthquake: Pax Americana is cracking, and Pax Sinica is already breathing down your neck

On Wednesday night entered President Donald Trump’s new economic ultimatum is in effect: the total tariff on Chinese goods has reached a sky-high 104%. This is more than a symbolic barrier – it is the beginning of a new phase of economic warfare that could shake the global order. Everyone is under attack: from the American consumer who just yesterday ordered from Shein and Temu for next to nothing, to global corporations that have been painstakingly building their logistics chains for decades.

While someone sarcastically calculates a “discount” for China in the event of an invasion of Taiwan, the customs empire is in full swing. There are no diplomatic curtseys in Trump’s rhetoric — only dominance and public humiliation of allies who “kiss his ass.” Behind the scenes of the presidential campaign with a “spine of steel” is good old isolationist America, handing out tariffs instead of compromises.

The European Union, India, Latin America — countries that only yesterday were balancing between Washington and Beijing are increasingly leaning towards China as a more stable, though no less difficult, partner. The question is being asked more and more often: if the collapse of the Soviet system marked the end of the Pax Sovetica, are we not now witnessing the collapse of the Pax Americana — under the blows of political unpredictability, customs blackmail and domestic populism?

And while Trump announces “huge” tariffs, global investors count losses, and global logistics chains — cracks. In a game where empires fight not for territories but for flows, economic turbulence turns into a tectonic shift. There is only one question: are we at the beginning of a turning point — or are we already at the epicenter?

China: The US is making “mistake after mistake”

On Wednesday, Donald Trump’s administration imposed an unprecedented 104% tariffs on all Chinese goods. This was reported by White House press secretary Caroline Levitt on Tuesday, stressing that it is not only about the continuation of the tariff policy from Trump’s first term, but also about its large-scale strengthening within the framework of the new “reciprocal” package.

First, China was to receive a 34% increase in tariffs — this was already announced as a response to previous restrictions from Beijing. But after China failed to lift a planned mirror-image 34% tariff on US goods by midday Tuesday, Trump announced an additional 50% on top. Thus, just this week, the United States introduced another +84% of tariffs — in addition to those already in place.

As a result, the total tax burden on Chinese goods will increase to an impressive 104%, if you take into account all previously introduced tariffs.

In response, China’s Ministry of Commerce said it “strongly opposes” the new 50% tariffs, calling Washington’s move “a mistake on top of a mistake”. Escalation has already been promised in Beijing, including new restrictions on imports from the US.

The markets reacted — and not in favor of the US

US stock markets initially showed growth on Tuesday morning, but after the high-profile statement of the press secretary of the White House Caroline Levitt, everything changed dramatically. Indices went down: the Dow Jones lost 320 points (-0.84%), the S&P 500 fell 1.57%, and the technology Nasdaq fell as much as 2.15%.

The negative signal was quickly picked up by the Asian stock exchanges. Japan’s Nikkei 225 opened down 3% on Wednesday morning, Hong Kong’s Hang Seng also lost about 3%, while South Korea’s Kospi and Australia’s ASX 200 were down about 1%.

Financial markets reacted sensitively to the risk of a new wave of trade escalation that could hit global manufacturing, supply chains and investor sentiment.

EU turns to China for help in Trump’s trade war

The European Union has asked China for help in tracking the flow of Chinese imports likely to flood into the EU after the US imposed higher tariffs on Chinese goods. The publication writes about it Political. China, for its part, has vowed to continue its standoff with Washington, which could lead to tariffs of up to 104% on Chinese goods imported into the US. As the EU has already experienced similar situations during the previous term of the Trump presidency, there is a risk that the increase in tariffs on Chinese goods could cause some of these imports to be diverted to European markets.

European Commission President Ursula von der Leyen held talks with Chinese Prime Minister Li Qiang, discussing the possibility of creating a mechanism to monitor and control such diversions of goods. She highlighted China’s important role in addressing this issue, particularly in sectors where there is already global overcapacity, such as steel, aluminum and electric vehicles.

If the diplomatic initiative fails, the EU will have to take additional “safeguard measures” to control unauthorized trade flows. These measures include the introduction of special customs duties to prevent sudden changes in import volumes. The European Union is also committed to maintaining a stable and fair global trading system where there is a level playing field for all participants, despite tensions with China over subsidizing its export industries.

In July, an EU summit with high-ranking Chinese officials is planned, at which these issues will be discussed in more detail.

There is no unity in the EU regarding the reaction to “magnificent tariffs”

The European Commission is preparing to unveil its proposals for countermeasures against the US early next week in response to trade tariffs imposed by the Trump administration. The EU plans to impose new tariffs on US goods, including soybeans, chicken and motorcycles, after the US raised tariffs on steel, aluminum and other European goods.

Despite these measures, Brussels remains open to negotiations with Washington. The representatives of the EU confirmed that the dialogue with the USA did not bring results, and the offer of mutual cancellation of car tariffs was not accepted. The EU also rejected US demands for changes in VAT policy and product standards, in particular for genetically modified products.

In the European Union itself, there are differences in approaches to the response to the tariffs introduced by US President Donald Trump. In particular, France, Germany and Spain advocate a quick and tough response, while Italy, Greece, Romania and Hungary call for prudence and avoiding the escalation of the conflict. In response to these tariffs, the EU is considering using a “bazooka” tool that could be aimed at US technology companies and service providers to increase pressure on the US.

Domestic disputes and fears about the economic fallout for European industries have made the tariff countermeasures difficult to implement, but some hope that pressure on the U.S. could force Trump to change his policy.

What is “Bazooka”?

In general, this is the American name for a hand-held anti-tank grenade launcher. As a metaphor for her apply on the designation of a tool of powerful sanctioning influence. The official name of this mechanism is Anti-Coercion Instrument (ACI), which translates as “Instrument against coercion”.

The tool earned its nickname because of its potential power: it gives the EU the ability to resort to harsh economic sanctions that could affect the activities of large US technology companies with significant influence on the European market. One example of the application of this tool could be sanctions against companies that violate the terms of trade or facilitate political pressure from their government.

Since this tool can have serious economic consequences for the target countries, its use is considered as a last resort. The EU wants to maintain a balance in relations with major trading partners, but at the same time ensure its economic independence and protection from external influence. This makes the bazooka a powerful deterrent in global trade.

Thus, the use of this instrument is part of the EU’s strategy to ensure the protection of its interests in a world where global economic disputes are becoming increasingly complex and politicized.

What is written about Trump’s tariffs in the Chinese media?

An increase in US tariffs could have serious destabilizing effects on world trade, which would ultimately affect the United States itself. This is the opinion in an interview for the Chinese news agency Xinhua expressed Egyptian analyst Mokhtar Gobashi. President Donald Trump has “dropped an economic bomb” on the international trading system, he said, and while the effects of the financial explosion will be felt around the world, the United States will ultimately suffer the most.

The expert reminds that Trump’s tariff package includes a basic 10 percent tariff on goods from all countries, as well as additional “reciprocal tariffs” on countries with high trade barriers for American exports. Among those who fall under these measures are the countries of the Middle East, in particular Syria, Iraq and Jordan, where rates can reach 41%, 39% and 20%, respectively.

Ghobashi pointed out that some Arab countries, such as Iraq and Jordan, have large positive trade balances with the US, making them more vulnerable to the new restrictions. Iraq, for example, has a trade balance with the US of almost $6 billion each year, while Jordan has about $1 billion.

Trump’s position, with his pathetic “America First” principle, favors unilateral decisions that change global power dynamics in Washington’s favor. However, Gobashi believes that the United States is on the verge of “imperial overexertion.” It is about reaching a peak, after which a decline may follow. Trump hopes the tariffs will help the US maintain its position as the world’s only superpower, but economists warn of a possible global recession as a result of the measures.

The analyst warns that tensions in trade relations could lead to a redistribution of global trade routes. This could strengthen the interaction between the EU and China and even contribute to the formation of new trade alliances that will bypass the US. Trump, having started a trade war, may understand that its consequences will only complicate trade relations with many countries.

Agency Xinhua publishes a selection of expert assessments, emphasizing that the increase in tariffs will have a detrimental effect on the “sluggish economy” of the EU.

Zarko Puhovski, Croatian political scientist: “Trump’s policies have created significant uncertainty in the business world. The EU will suffer the most because it lacks both the unity and the political strength to stand up to the United States.”

Milen Keremedchiev, Bulgarian economic expert: “The European economy will suffer greatly. Europe now faces the difficult challenge of finding new markets, a process that will be neither quick nor easy. We see rising prices and falling sales.”

Hendrik Malkov, WIFO economist: “US protectionist measures are hurting Austria’s industrial base. In sectors such as automotive and mechanical engineering, where dependence on exports is particularly high, the new tariffs will cause significant damage.”

Bernd Lange, Chairman of the Committee on International Trade of the European Parliament: “The new U.S. tariffs could trigger a cycle of retaliation and economic recession for both the United States and the world at large.”

Lubo Jurčič, Croatian economist: “Tariffs will slow economic growth and increase inflation by 1 to 3 percent worldwide.”

So analysts warn that the US’s “magnificent tariffs” and potential retaliatory measures from the EU could disrupt trade flows, dampen growth potential and increase inflation, further destabilizing the EU’s already fragile economy.