Trump ratchets up pressure, threatens 200% tariffs on China

• Trump proposes 200% tariff on Chinese magnets
• China controls 90% of the global supply of rare earths
• Imports under US$800 will lose exemption

US President Donald Trump signaled on Monday (25) that his administration could impose a 200% tariff on magnets originating from China. The announcement comes amid a growing trade dispute over technological inputs considered strategic. In his words: "We have to charge a 200% tariff or something like that," Trump said, adding: "I could destroy China, but I won't do that."

The statements came after Beijing's April decision to limit the export of rare earth elements, which are crucial for industries ranging from smartphones to electric vehicles and defense systems. China added new materials to its export control list, intensifying the impact on the US production chain, which relies heavily on these inputs. Currently, China holds 90% of the global supply of these magnets.

The situation worsened with the recent acquisition of 10% of Intel by the US government. The chip giant is highly dependent on Chinese inputs, making any supply disruption a risk to national technological security. Despite the restrictions, China increased its rare earths shipments by more than 4.700 tons in July, expanding its negotiating power.

Trump also issued an executive order extending the suspension of a new tariff increase by 90 days. Without this measure, Chinese products would have seen their tariffs jump from 30% to 145%. This tariff truce between the two countries is valid until November 9th.

Between the beginning of the year and April, the average tariff rate imposed by the US rose from 2,5% to 27%, reaching one of the highest levels on record. In August, there was a technical reduction to 18,6%, but the value remains well above the historical average. By July, tariffs already accounted for 5% of US federal revenue.

Furthermore, the president increased tariffs on steel, aluminum, and copper to 50% and implemented a 25% tariff on imported vehicles. In April, he invoked the International Emergency Economic Powers Act (IEEPA) and imposed a standard 10% tariff on imports from countries without trade agreements.

Another significant change was decreed to take effect on August 29: the end of the exemption for shipments valued at less than US$800. From that date, small packages – such as those from Chinese e-commerce sites – will be subject to the full tariff, further increasing trade barriers between the two powers.