Trade war set to worsen as China's tit-for-tat tariffs on US goods kick in

Both sides have signalled intent to crank up the pressure instead of finding reconciliation

- Lim Min Zhang

It was no deal for the first round of the trade war between Washington and Beijing, with China's tit-for-tat tariffs on some US$14 billion (S$19 billion) of American goods kicking in right after midnight (US time) on Feb 10.

The ball now appears to be in the US' court, and further escalation could be on the cards as both countries have signalled that they are preparing to ratchet up the pressure instead of finding reconciliation.

An "escalation clause" in Mr Donald Trump's Feb 1 executive order to slap a 10 per cent tariff on Chinese goods notwithstanding, the US President on Feb 9 told reporters that he would announce reciprocal hikes on "every country" later this week.

China's measures, announced on Feb 4 and targeted to hit Mr Trump's support base, were seen to be calibrated to leave room for potential dialogue, but also signalled that Beijing is ready to hit back more forcefully.

It has, after all, laid the groundwork since the previous trade war during the first Trump presidency between 2017 and 2021.

Beijing on Feb 4 announced tariffs of 15 per cent on American coal and liquefied natural gas (LNG), and 10 per cent tax hikes on crude oil, farm machinery, pickup trucks and other goods.