China has issued a sharp rebuke of new U.S. tariffs, accusing Washington of “unilateralism, protectionism and economic bullying” in a growing trade confrontation that has drawn in major companies such as Tesla and GE Healthcare.

Putting “America First” over international rules harms the stability of global production and the supply chain and seriously impacts the world’s economic recovery, China’s Foreign Affairs spokesperson Lin Jian told reporters.

Chinese officials criticized the administration of President Donald Trump after it imposed a sweeping 34 percent tariff on Chinese goods, escalating from previous rounds of tariffs announced earlier this year.

Beijing has responded with its own 34 percent tariff on American exports and has moved to restrict key imports such as sorghum and poultry while tightening export controls on critical rare earth elements. At the same time, China filed a formal complaint with the World Trade Organization, signaling the dispute could extend into international legal channels.

Why It Matters

The latest round of tit-for-tat tariffs heightens tensions between the world’s two largest economies, with ripple effects across global markets and trade networks. The United States’ use of trade penalties to address geopolitical and security issues, such as Beijing’s alleged involvement in the fentanyl crisis, has drawn criticism for bypassing traditional diplomatic channels.

Chinese markets in Hong Kong and Shanghai reacted with sharp losses.

What To Know

Trump’s declaration of “Liberation Day” marked the formal rollout of the new 34 percent tariffs, which come on top of two earlier rounds of 10 percent tariffs implemented in February and March. Trump justified the policy by pointing to China’s alleged role in exacerbating the fentanyl epidemic.

In retaliation, China suspended imports of several U.S. agricultural products and rare earth elements crucial for high-tech manufacturing.

Despite the friction, Chinese officials met with U.S. corporate leaders over the weekend, signaling a possible avenue for de-escalation. Executives from Tesla, GE Healthcare, and other American firms participated in the talks.

What People Are Saying

Lin Jian, China’s Foreign Affairs spokesperson, said: “The U.S. is seeking hegemony in the name of reciprocity, sacrificing the legitimate interests of all countries to serve its own selfish interests, and prioritizing the U.S. over international rules,” he said.

“This is typical unilateralism, protectionism and economic bullying.

“The abuse of tariffs by the United States is tantamount to depriving countries, especially those in the Global South, of their right to development.”

On Monday, Beijing struck a note of confidence even as markets in Hong Kong and Shanghai tumbled. The People’s Daily, the Communist Party’s official mouthpiece, had strong words. “The sky won’t fall,” it declared, even if the U.S. tariffs have an impact.

“Faced with the indiscriminate punches of U.S. taxes, we know what we are doing and we have tools at our disposal,” it added.

What’s Next

While China has not confirmed whether President Xi Jinping will meet with Trump or other U.S. officials to resolve the tariff dispute, the issue is expected to feature prominently in upcoming international forums. Meanwhile, Beijing is pressing its case at the WTO and signaling readiness for a prolonged confrontation if needed.

The involvement of American corporations may serve as a moderating influence, particularly if economic pressures begin to affect their operations in China. However, with both governments entrenched in their respective positions, a swift resolution appears unlikely.

This article includes reporting from The Associated Press.