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TRUMP’S TARIFFS VS. CHINA’S LONG GAME  
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Imran Khalid
January 27, 2025
Foreign Policy in Focus
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_ China is shrugging off Trump's tariffs and economic threats. _

, shutterstock

 

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
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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
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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
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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
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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 redefine—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.

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Imran Khalid [[link removed]]
Imran Khalid is a geostrategic analyst and columnist on international
affairs. His work has been widely published by prestigious
international news organizations and publications.

* China; US Trade Policy; Trump's Tariffs;
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