China’s Latest Official Response to Trump’s Reciprocal Tariffs: Focus on Domestic Resilience and Strategic Confidence

The United States’ reciprocal tariff policy has sparked widespread discussion within China. Chinese policy observers have been actively speculating and commenting on the intentions behind this move, and two main schools of thought have emerged.

One camp, pointing to what they see as a rather crude and hasty methodology behind the tariff calculation, believes that Trump’s team is an amateurish operation—essentially a "makeshift troupe"(草台班子)—and that the U.S. is bound to decline as a result. According to this view, China is on the verge of a once-in-a-lifetime opportunity to rise.

The other camp believes that Trump is playing a long game and that the underlying strategy is to contain China. A popular version of this argument suggests that Trump deliberately set an extremely high tariff rate in order to lure other countries into negotiations, where he could then pressure them into making concessions that would serve U.S. economic and geopolitical interests.

Following Trump’s tariff announcement, China responded with a comprehensive and forceful package of countermeasures. Today, two important official articles were also released. One, issued in the form of a government position paper titled “Position of the Chinese Government on Opposing the U.S. Abuse of Tariffs”, serves to formally declare the Chinese government’s stance toward Trump’s tariff policy to the outside world. The other, published as a commentary in People’s Daily, is aimed at calming domestic sentiment and easing market panic.

Position of the Chinese Government on Opposing the U.S. Abuse of Tariffs (April 5, 2025)

Recently, the United States has announced the imposition of sweeping tariffs on all its trading partners, including China, under various pretexts. This move constitutes a grave violation of the legitimate rights and interests of other countries, a serious breach of World Trade Organization rules, and a severe blow to the rules-based multilateral trading system. It undermines the stability of the global economic order. The Chinese government strongly condemns and firmly opposes such actions.

These measures by the U.S. defy basic economic principles and market laws, disregard the hard-won balance of interests reached through multilateral trade negotiations, and ignore the fact that the United States has long reaped enormous benefits from international trade. By weaponizing tariffs to exert extreme pressure and gain selfish advantage, the U.S. is engaging in blatant unilateralism, protectionism, and economic bullying. Under the guise of seeking “reciprocity” and “fairness,” the U.S. is in fact pursuing “America First” and “American exceptionalism.” It seeks to overturn the current international economic and trade order with tariffs, to place U.S. interests above global public interest, and to serve hegemonic objectives at the expense of the legitimate rights of countries around the world. Such actions are bound to be widely rejected by the international community.

China is a country with a long-standing civilization and a nation of propriety. The Chinese people value sincerity and integrity. We do not provoke trouble, but we are not afraid of it either. Pressure and threats are not the right way to deal with China. We have taken, and will continue to take, firm measures to safeguard our sovereignty, security, and development interests. The essence of China–U.S. economic and trade relations should be mutual benefit and win-win cooperation. The United States should heed the shared expectations of both peoples and the international community, and in light of the fundamental interests of both countries, stop using tariffs as a weapon to suppress China economically and trade-wise, and stop infringing upon the legitimate development rights of the Chinese people.

As the world’s second-largest economy and second-largest consumer market, China’s door to the outside world will only open wider, regardless of how the global situation evolves. We will continue to advance high-level opening-up, steadily expand institutional opening in terms of rules, regulations, management, and standards, implement high-level policies for trade and investment liberalization and facilitation, foster a market-oriented, law-based, and internationalized business environment, and share development opportunities with the world for mutual benefit.

Economic globalization is an inevitable path for human development. The multilateral trading system, with the WTO at its core and rules at its foundation, has played a vital role in advancing global trade, promoting economic growth, and supporting sustainable development. Open cooperation is the tide of history. The world must not—and cannot—return to a state of mutual isolation and division. Mutual benefit and win-win outcomes reflect the will of the people. Economic bullying that seeks gains at others’ expense will ultimately backfire. Advancing economic globalization toward a more open, inclusive, balanced, and beneficial direction is the shared responsibility of the international community.

Development is a universal right of all countries, not the privilege of a few. Global affairs should be handled through consultation by all, and the future and destiny of the world should be jointly determined by all countries. There are no winners in trade wars or tariff wars, and protectionism leads nowhere. All nations should adhere to the principle of extensive consultation, joint contribution, and shared benefits; uphold true multilateralism; jointly oppose all forms of unilateralism and protectionism; and safeguard the international system with the United Nations at its core and the multilateral trading system with the WTO at its core. We believe that the vast majority of countries that value fairness and justice will stand on the right side of history and make choices that serve their own interests. The world needs fairness, not dominance.

People’s Daily Commentator: Focus on Managing Our Own Affairs Well and Strengthen Confidence in Effectively Responding to the Impact of U.S. Tariffs

The U.S. government has gone against the global trend by imposing so-called “reciprocal tariffs” on nearly all of its trading partners, including China. In response, China immediately adopted firm and forceful countermeasures, drawing intense global attention. At this point, it is essential to objectively analyze the impact of the U.S.’s abuse of tariffs on China, view the sound momentum of China's economic development with reason, and remain confident in our ability to cope with this latest round of American containment and pressure.

The indiscriminate tariffs imposed by the U.S. will indeed have an impact, but it will not be catastrophic. The U.S. government’s 34% tariff increase on Chinese goods, in addition to previously imposed tariffs, will significantly suppress bilateral trade. In the short term, this will inevitably exert negative pressure on Chinese exports and intensify downward economic pressure.

However, we must recognize that China is a super-sized economy with strong resilience to withstand U.S. tariff bullying. In recent years, we have actively pursued market diversification, and our dependence on the U.S. market has been steadily declining. China’s exports to the U.S. as a share of total exports have fallen from 19.2% in 2018 to 14.7% in 2024. Thus, a decline in exports to the U.S. will not have a subversive impact on the overall economy. Meanwhile, many American products are highly dependent on imports from China. Today, the U.S. cannot do without China in many consumer goods, and also relies on Chinese imports for capital and intermediate goods—some categories have a dependence level exceeding 50%. In the short term, these cannot be easily substituted on the global market. In the context of deeply integrated global industrial and supply chains, complete decoupling of U.S.-China trade is unrealistic.

Moreover, economic and trade cooperation with emerging markets holds tremendous potential and is increasingly becoming an important foundation for stabilizing China’s foreign trade. China is already the major trading partner of more than 150 countries and regions worldwide. Since 2018, the share of China’s exports to ASEAN has risen from 12.8% to 16.4%, while exports to Belt and Road countries have increased from 38.7% to 47.8%, both maintaining strong growth momentum. China also has vast room for domestic market buffering, which serves as a vital economic fallback. In 2024, among the hundreds of thousands of Chinese enterprises with export performance, nearly 85% also engaged in domestic sales, with domestic sales accounting for nearly 75% of their total revenue. The government is accelerating efforts to remove policy bottlenecks that hinder the conversion of exports to domestic sales, expanding policies to stimulate domestic demand, and improving the absorption capacity of the domestic market.

At present, China’s economy is stabilizing and improving, giving us both the strength and the confidence to withstand the shock from U.S. tariffs. Since the U.S. initiated the trade war with China in 2017, no matter how it has attacked or suppressed us, China has continued to grow and progress, demonstrating resilience that strengthens under pressure—this is our greatest source of confidence in confronting external challenges.

China’s economic circulation has continued to improve. In recent years, we have worked to optimize supply, stimulate demand, and ensure smooth domestic economic flows, which have significantly strengthened the internal drivers of growth. Especially after the September 26 Central Politburo meeting last year, with a series of new policies implemented, the domestic economy has continued to rebound. In the first two months of this year, domestic demand—such as investment and consumption—grew faster than expected, exports held up well, and both manufacturing and services PMIs continued to rise. First-quarter growth is projected to exceed 5%.

Technological innovation continues to play an empowering role. We have seized the opportunity to develop new quality productive forces, driven industrial transformation through scientific and technological breakthroughs, and made progress in areas such as integrated circuits, artificial intelligence, and humanoid robots. These demonstrate the immense vitality of Chinese innovation. Attempts to choke or suppress China’s technological advancement only accelerate our efforts to achieve breakthroughs in core technologies.

Risk mitigation efforts have yielded significant results. In recent years, we have withstood both domestic and international pressure, taken on difficult yet necessary tasks, and worked to defuse major risks in real estate, local government debt, and small and medium-sized financial institutions. Currently, these three major risks are effectively under control and trending downward. The real estate market is showing signs of recovery, and public confidence is improving, particularly in first-tier cities.

Expectations across sectors are also improving. China’s long-term stable social environment, the continued improvement of the business environment, and consistent policy goals provide businesses with a stable and reliable outlook. Since the beginning of this year, both domestic and international views of China’s economic prospects have markedly improved. International organizations such as the OECD, along with many Wall Street financial institutions, have raised their forecasts for China’s growth, expressed optimism toward Chinese capital markets, and increasingly see China’s “certainty” as a hedge against U.S. “uncertainty.”

Faced with the U.S.’s barrage of reckless tariff actions, we are well-prepared and well-equipped. After eight years of trade war with the U.S., China has accumulated substantial experience. Although many in the global market view the new round of U.S. tariffs as unexpectedly aggressive, the Central Committee of the Communist Party of China had already anticipated new rounds of U.S. containment and pressure. We had fully estimated the potential impact and ensured sufficient planning and capacity in our response strategies.

The Central Economic Work Conference last year made comprehensive arrangements on how to respond to this new wave of suppression from the U.S., emphasizing the need to enrich and refine our policy toolbox, adjust policies dynamically based on the degree of external shocks, strengthen extraordinary counter-cyclical regulation, and improve macroeconomic regulation’s foresight, focus, and effectiveness. During this year’s Two Sessions, many policies were introduced to reflect this extraordinary approach—such as setting the fiscal deficit ratio at around 4%, and using government bond funds to expand support for “new infrastructure,” “new urbanization,” and other major projects.

Looking forward, monetary policy tools such as interest rate and reserve requirement cuts have ample room to be adjusted as needed and can be implemented at any time. Fiscal policy has been directed toward increasing spending intensity and accelerating disbursement progress. There is still room to expand fiscal deficits, special-purpose bonds, and special treasury bonds. Extraordinary efforts will be made to stimulate domestic consumption, expedite the implementation of existing policies, and introduce new reserve policies when necessary. Practical and targeted policies will be used to stabilize capital markets and boost market confidence, with additional contingency measures to follow. All levels of government will provide targeted support to industries and enterprises significantly affected by the tariffs, using “one policy per industry” and “one policy per enterprise” approaches to help businesses adjust their strategies. Enterprises will be guided to maintain trade with the U.S. to the extent possible while actively exploring domestic and non-U.S. markets. At the same time, we will urge the U.S. side to correct its erroneous practices and resolve trade frictions through consultations based on equality, mutual respect, and mutual benefit with China and the international community.

We will remain firmly committed to managing our own affairs well and respond to external changes by accelerating domestic structural adjustment. As the world undergoes profound changes unseen in a century, the U.S. tariff policy adds new uncertainties to the evolving global political and economic landscape. As a responsible major global power, China must transform external pressure into momentum, treat this challenge as a strategic opportunity to accelerate the establishment of a new development paradigm, promote high-quality development, and advance economic restructuring. Through our own stable development, we aim to contribute more certainty and stability to global economic growth.

As high U.S. tariffs continue to squeeze space for Sino–U.S. trade, it is even more important to regard the expansion of domestic demand as a long-term strategy. We must work to make consumption the main engine and stabilizer of economic growth, leveraging the unique advantage of China’s super-sized market. On the demand side, we must take real and sustained steps to increase household income and reduce burdens, thereby enhancing people’s capacity and willingness to consume. On the supply side, we will accelerate the establishment of a unified national market, improve the business environment, and support domestic enterprises in providing high-quality products and services that meet the real needs of the people.

In the face of the U.S.’s ever-changing and high-pressure tactics, we have not closed the door to dialogue and negotiation, but we harbor no illusions either—we are fully prepared for all possible impacts. As the saying goes, “Those who share the same goals will prevail; those who stand together through storms will prosper.” With the strong leadership of the CPC Central Committee and the institutional advantages of pooling national resources for key tasks, we will surely be able to turn crisis into opportunity and achieve steady, long-term progress. As General Secretary Xi Jinping pointed out, “China’s economy is a vast ocean, not a small pond.” This vast ocean can withstand the strongest winds and waves, endure the chill of trade storms, and ultimately show the world the confidence and composure of a nation that embraces all rivers.