The U.S. imposed new tariffs on imports from Canada, Mexico, and China, leading to retaliatory measures from these countries. This escalation has sparked fears of a global trade war, resulting in significant declines in stock markets across Europe, Asia, and the U.S. Investors are concerned about a potential global economic slowdown due to these trade tensions.

The tension between the U.S. and China is rooted in economic, military, and geopolitical competition.

1. Trade and Economy – The U.S.-China trade war, tariffs, and restrictions on technology exports (e.g., semiconductors) have fueled economic rivalry. The U.S. has accused China of unfair trade practices, intellectual property theft, and currency manipulation.

2. Technology and Security – The U.S. has imposed bans on Chinese tech companies like Huawei and TikTok, citing national security risks. Meanwhile, China is pushing for self-sufficiency in critical technologies.

3. Taiwan – The U.S. supports Taiwan through arms sales and diplomatic visits, while China sees the island as a breakaway province and has increased military pressure around it.

4. South China Sea – China claims vast areas of the South China Sea, leading to conflicts with U.S. allies and freedom-of-navigation operations by the U.S. Navy.

5. Human Rights and Ideology – The U.S. criticizes China’s actions in Xinjiang (against Uyghur Muslims), Hong Kong (crackdown on democracy), and censorship, while China views this as interference in its internal affairs.

6. Military Posturing – Both countries are expanding military capabilities, with increasing U.S. military presence in the Indo-Pacific and China’s growing assertiveness.

7. Global Influence – The U.S. and China compete for influence through initiatives like China’s Belt and Road Initiative and U.S. alliances.