Maroc - EURASIAREVIEW.COM - A la une - 01/Feb 00:27

Trump’s Tariffs Vs. China’s Long Game – Analysis

Donald Trump, never one to shy away from a headline-grabbing maneuver, announced on January 21 that he’s mulling a 10 percent tariff on Chinese imports, potentially set to take effect February 1. This latest salvo in the long-simmering trade spat between the world’s two largest economies raises eyebrows and questions in equal measure. The proposed tariffs, ostensibly aimed at pressuring Beijing into a more U.S.-friendly trade posture, ironically come just as China’s exports, including those to the United States, have recently surged. This trend seems to contradict Trump’s intended goal of curbing Chinese economic influence. During his re-election campaign, Trump upped the ante, threatening tariffs as high as 60 percent on Chinese goods. Such rhetoric fueled an already heated trade war but has yet to yield the intended concessions. So, are Trump’s tariff threats strategic posturing or simply an effort to reclaim economic leverage? Trump is once again casting China as the central antagonist in America’s economic and social struggles. He has, for instance, accused Beijing of fueling the fentanyl crisis by supplying precursor chemicals to U.S. neighbors, thus framing the addiction epidemic as a consequence of lax border enforcement and international indifference. The rhetoric didn’t stop there. Trump proposed a steep 25 percent tariff on imports from Mexico and Canada, accusing both countries of enabling illegal immigration and fentanyl trafficking into the United States. In tandem, he unveiled plans for an “external revenue service” to centralize collection of tariffs and foreign-derived revenue, signaling his continued belief in tariffs as a lever of economic power. By late 2024, Chinese exports to U.S. companies had risen 4 percent year-over-year, highlighting Beijing’s resilience in the face of punitive trade measures. Meanwhile, the trade imbalance remains staggering: Chinese exports to the U.S. reached $401 billion in 11 months in 2024, while American goods to China totaled just $131 billion. Trump’s escalating accusations against China, combined with his ambitious tariff strategy, reflect a broader effort to realign global trade, though it remains unclear who will blink first in this high-stakes standoff. In the chess game of global trade, tariffs are a double-edged sword, and Donald Trump is no stranger to wielding them. His latest proposal to slap tariffs on all Chinese imports promises to target every product imaginable, from everyday essentials to niche industrial goods. Although Trump touts this strategy as a way to protect American interests, the ripple effects could drive inflation higher, leaving U.S. consumers to bear the burden. Take ship-to-shore cranes, for instance, which are critical to U.S. infrastructure and which are entirely imported from China. A 25 percent tariff on these cranes has already added $131 million in costs to American ports. With no domestic alternatives, industries reliant on such imports find themselves trapped, unable to shift demand or dodge price hikes. It is a harsh reminder that protectionist policies often hit closer to home than intended. Meanwhile, Beijing appears unfazed. The Belt and Road Initiative and deeper partnerships with BRICS nations are part of a broader strategy to reduce reliance on the U.S. market. As China diversifies its trade network, its willingness to absorb the tariff hit without retaliation seems increasingly unlikely. The question remains: How long can the U.S. sustain this high-stakes trade war before consumers and industries alike demand a new strategy? As Trump’s trade war escalates, American businesses are caught in an increasingly fraught search for alternatives to Chinese imports. This pursuit, however, is no easy feat. Should the United States extend its tariff policies to key trading partners like the European Union, Canada, or Mexico, import costs from these nations could also skyrocket, creating a ripple effect that leaves few affordable options on the table. Compounding the issue is the already sanctioned Russian market, further narrowing the pool of viable suppliers. During the last tariff bout, levies on Canadian and Mexican steel drove domestic prices for iron and steel products up by as much as 17.7 percent in just eight months. The result was a zero-sum game for American consumers, who are left with two choices: higher costs or limited access to essential goods. Whether sourced from China or elsewhere, the burden ultimately lands squarely on their shoulders. Amid rising tensions, China’s economic resilience presents an uncomfortable truth for the United States: the trade war is not turning the tide as intended. China’s broader trade figures are even more telling. December exports shattered records, rising 10.7 percent year-over-year. For all of 2024, Chinese exports totaled an astonishing $3.58 trillion, up nearly 6 percent from 2023. China now has a record trade surplus of $992 billion, a 21 percent leap from the prior year. China’s surge in trade, although it benefits both economies in the short term, reveals the volatility of a system increasingly beset by competition and discord. The long game is being redefined—and not in Washington’s favor. As Donald Trump prepared for his second inauguration, the White House facilitated a phone call with Chinese President Xi Jinping in a carefully orchestrated gesture of diplomacy. Xi expressed hope for a “good start” to the China-U.S. relationship, emphasizing the importance of respecting “each other’s core interests” despite inevitable differences. For Beijing, the focus appears to remain internal. China seems unfazed by the return of Trump’s mercurial leadership. The state media has adopted a measured tone, reflecting Beijing’s preference for a steady course over reacting to external unpredictability. China’s strategy has been patient and deliberate. Recent interactions suggest a willingness to let Trump make the first move, matching his actions with calculated responses. Although the United States enjoys advantages in many arenas, time favors China. With a four-year timeline limiting Trump’s ambitions, Xi has the luxury of playing the long game.