US escalates trade war: Tariffs spark consumer price surge
Donald Trump has intensified the tariff war, arguing that it will benefit the American economy. However, experts are warning that the new tariff policy will significantly increase store prices. "A $150 pair of running shoes will be $230," calculated Matt Priest on CNN.
New US tariffs on China came into effect at midnight Eastern Time. Many experts point out that the tariff war initiated by Donald Trump is unlikely to support the American economy as the US president claims. Still, they will instead lead to much higher product prices for consumers.
CNN journalist Jim Sciutto highlighted rising costs in his program. Matt Priest joined him from the Footwear Distributors and Retailers of America (FDRA), an organization representing the interests of footwear manufacturers and retailers in the United States.
Sciutto asked his guest: How much would a pair of athletic shoes cost $100, manufactured in China or Vietnam, if they were produced in the USA?
"$300 or $400 easily. In fact, we've even just looked at the tariffs coming into place tonight at midnight, a $150 pair of running shoes will be $230," explained Matt Priest.
What does this mean for US-China relations?
The decision to impose 104 percent tariffs is another step in escalating trade tensions between the US and China. China failed to meet President Trump's deadline to withdraw retaliatory tariffs, prompting the US to take decisive action. As Fox Business reporter Edward Lawrence highlighted, China will see an additional 104 percent added to imports, which could impact future trade relations between these two countries.
China is the largest trading partner of the US when it comes to importing goods. At its peak, Americans imported goods from China worth over $500 billion annually. A significant deficit on the US side has long characterized trade relations between the United States and China. In 2024, the value of American exports to China was about $143.5 billion, while imports from China reached $438.9 billion, resulting in a trade deficit of $295.4 billion. The US exports agricultural products (soybeans, corn) to China and machinery, electronics, and industrial products, albeit on a much smaller scale.
The US has frequently accused China of artificially undervaluing the yuan, state support of domestic companies, limited market access for American businesses, intellectual property theft, and forced technology transfer. Over time, this has led to a deep trust crisis, culminating in the trade war initiated in 2018 during Donald Trump's first presidency.
What will be the effects on international trade?
The additional tariffs will affect China and 56 other countries with which the US has a trade deficit.
