President Donald Trump has tied the ongoing escalation in tariffs to national security concerns, emphasizing the need for the United States to bolster domestic manufacturing in case of a future conflict.
Speaking aboard Air Force One on Sunday, Trump highlighted the importance of self-reliance in vital industries such as pharmaceuticals. “We’re going to manufacture our drugs in the U.S.,” he said, arguing that the country must not depend on foreign sources — especially China — in the event of war or other emergencies. This comes as Trump suggests additional tariffs could soon be imposed.
Meanwhile, Chinese President Xi Jinping, during his visit to Vietnam — part of a larger diplomatic tour of Southeast Asia — pushed back against Washington’s stance. In a joint editorial with Vietnamese leaders, Xi warned that no country benefits from a tariff war, calling instead for support of multilateral trade systems and global supply chain stability. “Protectionism has no future,” he cautioned.
Xi is set to continue his regional outreach with upcoming visits to Malaysia and Cambodia, seeking to strengthen alliances as tensions with the U.S. persist.
The Trump administration has maintained a hardline approach, with a 145 percent tariff currently in place on many Chinese imports. Although there’s been a temporary freeze on some reciprocal duties, Beijing has responded by suspending exports of rare earth minerals — crucial materials in sectors like automotive, aerospace, and technology.
This retaliatory move has raised concerns in the U.S. manufacturing sector. Electric vehicle production, for example, relies heavily on these rare earth components. Trump’s top economic adviser, Kevin Hassett, acknowledged the growing challenges, saying, “It’s a small but vital part of the U.S. economy.”
Hassett noted that officials are working to assist affected small businesses in finding alternative sources for these materials. “We’re evaluating all options,” he added.
China’s dominance in the rare earth market has long been established, producing the majority of heavy rare earth metals globally and manufacturing about 90 percent of the world’s high-performance magnets used in advanced technologies.
“The administration remains deeply concerned about China’s influence,” Hassett said.
New tariffs aimed at the semiconductor industry are expected soon, Trump confirmed, though he hinted that there may be flexibility when it comes to consumer electronics like smartphones and laptops. “We’ll be discussing it with companies. Flexibility is necessary — we can’t be too rigid,” he explained.
Markets saw a slight uptick on Monday amid reports that some tech products might temporarily be exempt from the next wave of tariffs. However, Trump clarified that these items could still be included depending on how negotiations proceed.
Amid the economic uncertainty, anxiety is growing among business leaders. A recent poll by Chief Executive revealed that 62 percent of more than 300 CEOs now anticipate a recession or economic slump within six months — a notable increase from the previous month.
Ray Dalio, founder of investment firm Bridgewater Associates, echoed the sentiment during a recent interview on NBC’s Meet the Press, warning that the country is “at a decision-making point” and could face consequences more severe than a recession if the situation is mishandled.
