Trump says U.S. will impose 100% tariffs on China & impose export controls on 'critical software'

U.S. President Donald Trump has announced that he would impose an additional 100 per cent tariff on imports from China from Nov. 1.

Trump added in a post on Truth Social that the U.S. would also put export controls on critical software, in response to Beijing's decision to tighten export controls of rare earth minerals.

China produces over 90 per cent of the world's processed rare earths and rare earth magnets, which are essential materials in the making of products from electric vechicles to missiles, and semiconductors used in AI technology.

These restrictions were announced just three weeks before the Asia-Pacific Economic Cooperation (APEC) summit in late October, where Trump is expected to meet with Chinese leader Xi Jinping. The two last met in person in 2019.

In response to White House reporters, he said he had not cancelled the meeting with Xi. "I don't know that we're going to have it, but I'm going to be there regardless," he stated.

Trump's counterattack could escalate a trade war that the U.S. and China paused earlier this year after months of diplomacy.

Xi leveraging China's rare earths dominance, says expert

On Oct. 9, China added five new elements for rare earths export control and extra scrutiny for semiconductor users, Reuters reported. The Chinese Ministry of Commerce also added dozens of refining technologies to its export control list and introduced new rules requiring foreign rare earth producers using Chinese materials to comply with its regulations.

Speaking to BBC, China expert Jonathan Czin said that China's actions to tighten export control were a bid to shape the upcoming talks. "He's looking for ways to seize the initiative," he said, adding that the Trump administration has to "play a game of whack-a-mole and deal with these issues as they come up".

He didn't think China was worried about U.S. retaliation in response. "From their perspective, the Trump administration blinked," commented Czin.

Experts say that China's export controls on rare earth minerals is a critical hit to the American defence industry, as they are vital in making various military equipment ranging from aircraft engines, missiles, to military radars.

The Ministry of Commerce stated that export licences will not be issued to foreign defence users, while applications involving advanced semiconductors will be assessed on a case-by-case basis.

Financial markets hit by tariff announcement

Financial markets took a hit after Trump's call to introduce additional tariffs, with the S&P 500 down 2.7 per cent after closing, its steepest fall since April 2025, according to BBC.

The announcement also sparked "the largest liquidation event in crypto history" according to data analysis platform CoinGlass, with a sell-off worth approximately US$19 billion.

In contrast, gold saw an increase of 0.70 per cent, with investors flocking to the safe-haven asset.

Image via The White House/Facebook