Imagine the price of your overseas purchases suddenly doubling—not due to holiday sales promotions, but because of skyrocketing tariffs. Former U.S. President Donald Trump has issued a stark warning that could dramatically reshape U.S.-China trade relations, setting the stage for a potential economic showdown.
The 155% Tariff Ultimatum: Bluff or Serious Threat?
On October 20, during a meeting with Australian Prime Minister Anthony Albanese, Trump delivered a forceful statement on U.S.-China trade relations. He set November 1 as a "final deadline" for tariff escalation, threatening to impose an additional 100% tariff on all Chinese imports—on top of existing 55% duties—bringing the total tariff rate to a staggering 155% if no agreement is reached.
Such a move would significantly increase costs for American consumers purchasing Chinese goods and could fundamentally alter global trade dynamics. While wielding this tariff threat, Trump simultaneously expressed optimism about reaching a deal, confirming plans to meet with Chinese representatives during the upcoming APEC summit in South Korea—a classic example of his "carrot-and-stick" negotiation approach.
China's Response: "Trade Wars Have No Winners"
Chinese officials have maintained a consistent position amid the pressure. Chinese Ambassador to the U.S. Xie Feng emphasized that tariff wars benefit no one, urging Washington to avoid escalating tensions and repeating past mistakes. The Chinese government maintains that trade conflicts ultimately harm global economic stability and growth.
APEC Summit: Potential Turning Point?
Trump revealed his intention to discuss increased Chinese purchases of American agricultural products—particularly soybeans—during the APEC meetings, suggesting this could serve as common ground for compromise. The former president expressed confidence that the summit could yield what he called a "truly fair, truly great" trade agreement, though observers remain cautious about such prospects.
In a potentially significant diplomatic development, Trump disclosed he has received an invitation to visit China in early 2026, which could facilitate deeper bilateral dialogue if realized.
U.S.-Australia Pact: Reducing Reliance on Chinese Minerals
During the same meeting, Trump and Albanese signed an $8.5 billion critical minerals agreement designed to reduce dependence on Chinese supply chains. The deal includes over $1 billion in mutual investments within six months and U.S. Defense Department funding for a modern gallium smelter in Western Australia capable of producing 100 tons annually.
Albanese praised the agreement as elevating economic and defense cooperation to "a new level," marking a clear step in U.S. efforts to diversify critical mineral supplies away from China.
What Comes Next?
Trump's hardline stance introduces fresh uncertainty into U.S.-China trade relations. While the 155% tariff threat may represent negotiation tactics, it underscores America's increasingly assertive trade posture. Whether both nations can find common ground during the APEC summit will significantly influence global trade patterns in the coming months.