US President Joe Biden and Chinese President Xi Jinping managed to keep tensions between their countries contained in 2024. But when president-elect Donald Trump returns to the White House this month, he will end this fragile stability, drive an unmanaged decoupling of the world’s most important geopolitical relationship and increase the risk of global economic disruption and crisis.
Trump will begin his second term by announcing fresh tariffs on Chinese goods, with the goal of forcing a new economic agreement on China. Though the new tariffs won’t reach the across-the-board 60 per cent rate that he threatened during the campaign, the top rate on all Chinese imports is likely to double to at least 25 per cent by the end of 2025. In the meantime, China’s leaders will respond more forcefully and offer fewer concessions than they did during Trump’s first term, despite the Chinese economy’s continuing weakness.
After all, Chinese leaders fear that a conciliatory approach will be perceived as accepting national humiliation, which would further stoke already rising public anger within China. If a more constructive approach towards the United States in 2024 only brought the return of “Tariff Man”, why stick to that path? Trump’s threats are merely the latest aggressive gesture by the US, confirming Chinese suspicions that American policymakers are intent on containing China’s emergence as a great power.
The most sensitive of all subjects in US-China relations is technology policy. China objects to what it sees as US attempts to freeze its technological development and slow its economic rise. Trump’s security team will add more Chinese companies to the US Department of Commerce’s “Entity List”, making it more difficult for them to gain access to US technology, and it will expand export controls into more economic sectors.
For example, Trump will also follow the Biden administration’s lead on restricting the export of advanced computer chips to Chinese tech firms. China has already shown a willingness to retaliate against such measures by restricting its exports of critical minerals and the technology used to process them. These minerals are vital to the production of a broad range of modern technologies, including electric vehicle batteries, computers, consumer electronics and many products that the US considers essential for its own national security.
Disputes over Taiwan will almost certainly make Sino-American relations more toxic this year. Trump himself appears uninterested in Taiwan. But the more hawkish members of his administration, including Marco Rubio, his nominee for secretary of state, and incoming national security adviser Mike Waltz will push not only for closer US-Taiwan ties but also for a more explicit US guarantee of Taiwan’s security. That is a bright red line for Beijing.
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Citing China, Trump won’t rule out using military to reclaim Panama Canal and buying Greenland
Citing China, Trump won’t rule out using military to reclaim Panama Canal and buying Greenland
