by H E Wei Hongtian, Ambassador of the People’s Republic of China to Grenada
The recent US announcement of “reciprocal tariffs” on all its trading partners has sent shockwaves around the world.
Framed as an effort to level the playing field and address “unfair trade practices,” the policy instead creates new barriers that benefit no one. It will drive up costs for American families, disrupt global supply chains, and undermine the stability of the entire international trading system.
First, tariffs tax Americans’ wallets. Economists and trade experts warn that this tit-for-tat protectionist approach is a classic case of “shooting oneself in the foot” causing more harm to US consumers and businesses than to its intended targets. According to the Peterson Institute for International Economics, the new tariff plan could cost the average American household up to $2,500 a year, as prices rise on everyday essentials like electronics, clothing, and food. The institute also found that over the past 5 years, 92% of the costs from US tariffs on Chinese goods were absorbed by American importers and passed directly to consumers. US media reports have already noted rising prices for certain products — such as car parts — following the policy’s announcement. In effect, these tariffs are functioning as a “consumption tax” on the American public.
Second, tariffs fail to fix domestic woes. The logic of leveraging tariffs to address unequal trade barriers ignores fundamental differences in global trade structures, as tariff disparities are not the primary driver of the US trade deficit. They reflect structural factors like consumer demand, currency valuations and global supply chains, not just tariff rates. Simplistic and blunt measures like weaponising tariffs only further complicate the situation. For example, when the US imposed tariffs on Chinese goods earlier this year, China retaliated by targeting US soybeans, corn and liquefied natural gas, costing farmers $1.2 billion in lost revenue within months. Washington’s attempt to bring about manufacturing “reshoring” by tariffs is also unrealistic, which will only yield 2 outcomes: slow, expensive production and no market, domestic or global. Lawrence Summers, Harvard economist and former US Treasury Secretary, recently warned that current tariff measures may push the US toward an economic recession, potentially costing 2 million American jobs. Furthermore, these measures undermine America’s credibility, and they won’t “Make America Great Again” — they will only leave the US more isolated.
Third, tariffs endanger global stability. America’s tariff wars severely infringe upon the legitimate rights and interests of all countries, severely violate World Trade Organisation (WTO) rules, severely undermine the rules-based multilateral trading system, and severely disrupt the global economic order. This is a typical act of unilateralism, protectionism and economic bullying, and it is especially destabilising as the global economy is still at a time of heightened fragility. The WTO predicted that global trade growth would slow to 3% in 2025, down from 3.3% in 2024, due to rising protectionism. The International Monetary Fund (IMF) warns that it will trigger reduced investment and supply chain chaos, posing downside risks to the global economy. Projections indicate a 0.8% contraction in global economic output for 2025 and a 1.3% drop for 2026.
Fourth, tariffs hit the Global South hard. Despite being the world’s largest economy and running a nearly US$300 billion surplus in services trade in 2024, the US continues to justify protectionism with its goods trade deficit, putting “America First” by restricting other countries’ right to development, a sharp departure from shared prosperity. This disproportionately affects developing nations.
Take Grenada, for instance, it imported around US$200 million in goods from the US in 2023, while exporting just US$4.04 million. A new 10% US tariff on Grenadian products will further strain local livelihoods and deepen trade imbalances, placing the country at an even greater disadvantage in the global system.
African economies, many of which rely heavily on exports to fund growth and poverty reduction are losing ground too. Countries like Nigeria and Kenya, which export textiles and agricultural products to the US, risk losing market access as tariffs divert trade to higher-cost suppliers. Climate goals are also at risk. Tariffs on clean energy technologies — such as solar panels and electric vehicles — are slowing the global transition to renewables, threatening efforts to combat climate change. WTO data highlights the uneven burden: US tariff hikes will widen the wealth gap between developed and developing nations, undercutting progress toward the UN’s 2030 Sustainable Development Goals.
In response to the US unilateral tariff actions, China has taken necessary countermeasures to defend its legitimate rights and interests, uphold international fairness, and safeguard the multilateral trade system. These actions reflect China’s commitment to global cooperation and economic globalisation. If the US is determined to fight a tariff and trade war, China’s response will continue to the end.
For over 70 years, China’s development has been driven by self-reliance and perseverance, not by concessions or handouts. As the world’s second-largest economy and a major global consumer market, China continues to manage its affairs with confidence, focusing on stable, high-quality growth. In 2024, despite global challenges, China’s economy grew by 5%, contributing around 30% to global growth. Being more and more open is China’s firm commitment to sharing development with the rest of the world. Since 2017, it has reduced its negative list for foreign investment from 93 to 29 items and lifted all restrictions in the manufacturing sector. As the first major developing country to offer zero-tariff treatment on 100% of product lines to all least-developed countries with diplomatic ties, China actively promotes equitable development and shared prosperity. These actions demonstrate China’s responsible approach to fostering shared prosperity and narrowing global development gaps.
As important members of the Global South, China and Grenada share extensive common ground in pursuing national development and upholding international norms. China is ready to deepen mutually beneficial cooperation with Grenada in areas such as infrastructure, clean energy and connectivity. Together, let us uphold the UN-centred international system and the global order based on international law, while promoting inclusive and sustainable economic globalisation that advances shared prosperity for all.