China says “No fear” Beijing will raise tariffs on US goods to 125%

China’s leader Xi Jinping made his first public comment on Friday in response to the escalating trade war with the US.

Speaking to Spanish Prime Minister Pedro Sanchez in the Chinese capital, Xi Jinzhou said China is “not afraid” of the challenges, saying “No matter how the external environment changes, China will strengthen its confidence, maintain its resolve and focus on doing it.”

Without naming the US, XI called on the European Union to join China to resist “unilateral bullying,” saying the two economies account for “a third of the world’s total economy.”

“There are no winners in the tariff war. Opposing the world will segregate yourself,” Xi said.

Faced with rapidly escalating tariffs from the US, China is trying to develop relations with other economies, and is sure to offset the country’s heavy blow to exports. The approach has taken up some position as President Donald Trump slammed new taxes on almost all of Washington’s major trading partners, and the EU and others held new consultations with Beijing when they prepared their own measures.

But in the face of a collapse of stock markets around the world, after a surprising turnaround by Trump, China suddenly quarantined after a brilliant turnaround by Trump.

Several of Trump’s advisers have argued that this is a plan for a long time, and have spoken about further segregation of China in trade talks with other countries, perhaps by forcing them to agree to similar tariffs on Chinese products.

Beijing has repeatedly said he is open to discussions with Washington, but Trump has made it clear that Xi Jinping must be for his first move.

On Friday, China’s Treasury ministry said it was raising tariffs on US goods to 125% from the previously announced 84%, but said “If the US continues playing the game that was pulled out, China will ignore it.”

“At current tariff levels there is no market acceptance for US goods exported to China,” the ministry said in a statement, adding that Beijing could resist in other ways. “However, if the US insists that it will continue to effectively infringe on China’s interests, China will fight back resolutely and fight to the end.”

Albert Chang, professor emeritus at Huron University University in London, Ontario, is the author of Xi Jinping’s biographies and said the escalation of the trade war between the US and China would hurt both sides.

“Beijing does not want this trade war because its economic well-being is highly dependent on international trade and investment,” he said. “There is no chance that Beijing will surrender to the US yet.”

This leads to economic hardships in the US given Beijing’s advantage in manufacturing, given its important role in many supply chains, rare earth domination and other factors, Professor Chang added. “It’s a complete defeat situation.”