Tue Feb 04 22:06:00 IST 2025: ## US and China Exchange Tariffs, Phone Call Planned Amidst Escalating Trade War

**Washington/Beijing –** A phone call between US President Donald Trump and Chinese President Xi Jinping is anticipated today, following a dramatic escalation of the trade war between the two nations. Both countries imposed new tariffs on each other’s goods earlier this week.

China retaliated with levies on US energy, vehicles, and equipment just minutes after Trump’s tariffs on Chinese goods took effect. These new tariffs target key US exports to China, including coal, liquefied natural gas, and certain vehicles. Beijing also announced investigations into Google and companies that own Tommy Hilfiger and Calvin Klein, and imposed export controls on rare earth metals. China stated the measures are a response to Washington’s “malicious” unilateral tariff hike and will file a complaint with the World Trade Organization.

Meanwhile, Trump temporarily suspended planned tariffs on Mexico and Canada after both countries agreed to strengthen measures to combat fentanyl trafficking and illegal immigration. These agreements averted a 25% tariff on goods from these nations, at least for the next 30 days. Mexico has begun deploying 10,000 troops to its border, while Canada will appoint a “Fentanyl Czar” and designate drug cartels as terrorist organizations. Negotiations on broader trade agreements will continue during this 30-day period.

Trump’s trade advisor, Peter Navarro, stated that the possibility of halting tariffs on China rests solely with the president. While White House Press Secretary Karoline Leavitt confirmed the planned call with Xi, she offered no further details on its timing, stating that the tariffs on China are intended to address the flow of fentanyl into the US.

The escalating trade tensions sent global stock markets into a state of flux as investors anticipate further volatility. Trump, who has frequently used tariffs as a foreign policy tool, continues to maintain that these measures are designed to punish countries for failing to address illegal immigration and drug trafficking.

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