Trump's Tariff Measures Face China's Endurance: Trade Dispute Reaches Critical Juncture

U.S. President Donald Trump has unexpectedly ended trade discussions with Canada, pointing to an anti-tariff ad featuring Ronald Reagan as the reason—a decision that could shift Washington’s trade focus toward China amid rising tensions, according to

. Trump made the announcement on Truth Social after introducing a 35% tariff on Canadian goods and additional duties on metals and vehicles, as reported by the BBC. With negotiations between the U.S. and Canada now stalled, some experts believe this pivot could strengthen China’s position, as the country has already shown it can withstand U.S. tariffs by diversifying its supply chains, according to analysts at .

The breakdown in talks with Canada coincides with Trump intensifying pressure on China, threatening tariffs as high as 155% on Chinese products starting November 1 if a trade agreement isn’t reached, according to

. Trump, describing his strategy as a blend of “pressure and diplomacy,” reaffirmed his intention to meet with Chinese President Xi Jinping at the APEC summit in South Korea, as reported by . However, China has responded critically, with Foreign Ministry spokesperson Lin Jian stating that Trump’s threats are “not the right way to deal with China.” Recent Chinese export limits on rare earths—vital for U.S. technology and defense—have made negotiations even more complex, according to a .

Financial markets worldwide have already responded to the growing conflict. The combination of Trump’s tariff threats and China’s export restrictions has led to a drop in both stock and cryptocurrency markets, with more than $329 million in crypto positions liquidated within a single day, according to

. At the same time, U.S. agriculture—especially farmers in Iowa—are preparing for renewed trade retaliation, as Trump’s tariffs on China, Mexico, and Canada put billions in exports at risk, reports the .

Despite these challenges, China’s economy has proven more robust than expected. Although U.S. tariffs have reduced China’s GDP by 0.3%, Capital Economics analysts observe that global supply chains have adjusted, with other countries stepping in to meet U.S. demand. China’s “Dual Circulation” policy—which emphasizes boosting domestic spending and finding new export markets—has also helped shield its economy, as highlighted by

.

The Trump administration has tried to counter China’s advantages, including signing an $8.5 billion rare earth agreement with Australia to lessen U.S. dependence on Chinese supply, a move reported by Yahoo Finance. Nevertheless, concerns about China’s control over key minerals persist. Trump has also accused China of profiting from the U.S. opioid crisis, alleging that fentanyl is being smuggled through Venezuela despite the billions paid in tariffs, according to

.

With both countries continuing to impose retaliatory measures, the outlook for a resolution remains unclear. While Trump has expressed willingness to reach a “fantastic deal” with Xi, his tough approach—combined with the unresolved dispute with Canada—could further fragment the global economy. Upcoming discussions in Malaysia between U.S. and Chinese officials, ahead of a possible Trump-Xi meeting, might provide an opportunity to ease tensions, according to a

. For now, global markets remain on edge as the U.S.-China trade conflict moves into a new chapter, as noted by StreetInsider.

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