A day after US President Donald Trump imposed high tariffs on all foreign goods entering the US, China also announced a 34 percent tariff on US imports on Friday. Earlier, Trump had raised the tariff rate on Chinese imports from 34 percent to 54 percent.

China has become the first country to retaliate against Trump's new tax policies in an escalating global trade war. It is estimated that the tussle between China and the US, which is a major economy, will cause great damage to the world market. 

Interpreting the new tax announcement as a 'liberation day', Trump said that the US has introduced a new tax policy to end the trade deficit between China and other countries, from China to the European Union. While other countries are still under consideration regarding Trump's new tariff, the European Union (EU) has said that it is ready to negotiate with the American authorities on this matter. Due to the fear that the US new tax policy may lead to retaliatory tariffs, stakeholders say that it may increase the trade war and create fears of an economic recession. 

China, one of the United States' top trading partners, has announced a 34 percent tariff on all US imports effective April 10. China has also said it will file a case with the World Trade Organization (WTO) over the new tariffs. China has also said it will impose export controls on some rare minerals used in medical technology and consumer electronics. 

After Trump announced new tariffs, EU trade chief Maros Cefcovic said he would speak with his US counterpart on Friday. Sefcovic already said on Thursday that the EU will work in a "calm, carefully phased, integrated way" and take the initiative for negotiations. However, he also warned that if we cannot reach a fair agreement, we will not sit empty-handed.

France and Germany have suggested that the EU could retaliate by imposing tariffs on US tech companies. After French President Emmanuel Macron said that it would send the wrong message if French companies move to invest in the US, Finance Minister Eric Lombard has also asked the companies of his country to show 'patriotism'. "But we should not respond with the same weapons used by the US because if we do that, it could have a negative impact on Europe as well," Lombard said in a conversation with the news network BFM TV. 

The new tax policy taken by the US is affecting the world. Especially it seems to have affected car manufacturing companies. The US imposed a separate tariff of 25 percent on all foreign-made cars this week. Soon after, car companies are also trying to adapt to the new business system. Stellantis, the owner of Jeep, Chrysler and Fiatco, said it had halted production at some Canadian and Mexican assembly plants.

Japanese carmaker Nissan has also said it will review plans to cut production in the US. The company has already announced that it will stop selling two vehicle models made in the Mexican factory in the US market. Also, Sweden's Volvo Cars, which is owned by China's Geely, said it would increase production of its vehicles in the US and possibly produce more models there.

US President Donald Trump's tax on Japanese goods has caused a 'national crisis', Japanese Prime Minister Shigeru Ishiba said on Friday. Japanese companies are among the largest investors in the US. But after President Trump announced a heavy tax of 24 percent on imports, it seemed to cause a crisis in Japan's economy.

"As this step could cause a national crisis for Japan economically, the government is doing its best to reduce its impact in cooperation with all parties," Prime Minister Isiba said. He also called for talks with the Trump administration to resolve the issue smoothly. Bank of Japan Governor Kazuo Ueda has also warned that the new American tax policy may lead to a decline in the global and national economy. 

Also, Japanese government spokesman Yoshimasa Hayashi said on Thursday that he had instructed ministers to "closely study" the tax and take all necessary measures, including financial support for domestic industries and job protection. Hayashi said that Trump's new tax policy is "very regrettable" and that Japan has "serious concerns" about whether to comply with WTO rules and the US-Japan trade agreement.