Latest news with #MeanwhileinChina
Yahoo
26-02-2025
- Business
- Yahoo
China sees opportunity in a world turned upside down by Trump
Editor's Note: Sign up for CNN's Meanwhile in China newsletter which explores what you need to know about the country's rise and how it impacts the world. President Donald Trump's upending of US foreign policy has alarmed allies and nations in need. His administration has frozen foreign aid, threatened to take control of other countries' sovereign territory, exited key international bodies and alienated Europe with an embrace of Russia. But the head-spinning set of moves, that together signal a retreat from leadership of a liberal order to 'America First,' is playing right into the messaging of the US' biggest rival. In this time of 'transformation and turbulence,' China has a vision for a 'safer world,' its top diplomat Wang Yi told G20 counterparts last week as he reiterated Beijing's pitch for 'a new path to security' without alliances, 'zero-sum' competition and 'bloc confrontation.' That vision – coded language for reshaping a world order China sees as unfairly dominated by the West – has been a cornerstone of Chinese leader Xi Jinping's push to step up as an alternative global leader to the US. And the drive has the potential to take on new relevance, observers say, as Beijing eyes the opportunities to advance its influence in the wake of Trump's US foreign policy upset. Trump's shake-up was obvious even in the room of foreign ministers from the world's largest economies where Wang, China's most seasoned diplomat, spoke in South Africa last week. The absence of US Secretary of State Marco Rubio meant no high-ranking US diplomat was there to present an American counterpoint to a gathering of countries that make up 80% of the global population and three-quarters of international trade. On the surface, this shift has the potential to accelerate China's ascent as a global power, potentially granting the world's second-largest economy space to win more allies, boost its global leadership and shift global norms and rules – such as those on human rights or security – in its favor. But countries from Europe to Asia are well aware of the wide gap between Beijing's benign rhetoric and its behavior as it flouts a major international ruling to harass Philippine vessels in the South China Sea or intimidates Taiwan – the self-ruling democracy Bejing claims. Meanwhile, the Trump administration has signaled it wants to shift attention from other global conflicts to focus on its rivalry with China. And Beijing will face that and potential fresh US tariffs on its goods as it tries to revive a weak economy – limiting how much it can pour into expanding global influence. But even still, there are signs that China may see potential for those headwinds to just be some turbulence in a rise made easier by Trump's policies. 'Trump 2.0 era will undoubtedly weaken the US' leadership in international affairs,' an analysis published this month on the website of Shanghai-based think tank Fudan Development Institute said. 'As other countries, particularly the European Union and China, actively respond, the power vacuum left by the US withdrawal may be filled by them … With the US no longer able to dominate global issues as it once did, a new global governance structure may emerge,' it said. As Trump dismantles the US foreign aid sector – freezing funding to global education, health and development programs – some English-language arms of Chinese state media released scathing critiques of such assistance. Foreign aid is 'viewed by the US as a tool to maintain its hegemonic position and engage in geopolitical maneuvering,' nationalist tabloid the Global Times said in an article on USAID, an agency Beijing has long seen as a thorn in its side, accusing of sparking democratic 'color revolutions' and indoctrinating US proxies across the world. USAID, which was founded during the Cold War, has long played a key role in advancing American soft power and democratic ideals. Beijing, however, wasn't looking at Washington's aid freeze as an opportunity because – unlike the US – China treats 'other nations with sincerity, fairness, and selflessness,' an editorial by the state-run outlet claimed. There has been some indication China will take targeted steps to ramp up its support in regions it sees as strategically important in the wake of the US freeze – a move that would align with what experts have seen as a soft-power struggle between the two countries in recent decades. In Cambodia, for example, Beijing released $4.4 million for demining operations, as US-backed landmine removal programs were halted in eight provinces, the Associated Press reported, citing the Cambodian Mine Action Center. Overall, however, experts say there's little chance that Beijing would be able or willing to step up to fill the US aid void. China is a huge player in global development, funneling more than a trillion dollars into overseas projects between 2000 and 2021. But unlike the US, data show the vast majority of Beijing's development spending is not direct aid, but loans and other financing. And economic belt-tightening has seen Beijing move away from big-ticket commitments, like building railroads and power plants under Xi's signature Belt and Road overseas infrastructure drive, paring back to more modest projects in recent years. 'Trump is giving China some opportunity – but China might not be able to pick up this US gift,' said Shanghai-based foreign affairs analyst Shen Dingli. 'Due to our gloomy economy and the (downsized) version of Belt and Road … we have less money to buy loyalty.' Even still, China may look to capitalize on countries' uncertainty about the US to expand its trade and security ties, as well as access to critical minerals, observers say. And countries may take uncertainty in US relations – from the aid freeze to Trump's tariff threats – into calculations for dealing with the world's two largest economies. 'Beijing can send the message to the rest of the world … that the US is fundamentally going to be unreliable,' said Manoj Kewalramani, who heads Indo-Pacific studies at the Takshashila Institution research center in the Indian city of Bengaluru. 'Why would you want to pick a fight with Beijing now?' There are already signs of concern from some parts about Beijing's potential gains from a Trump-era pullback of US assistance. In an open letter to Trump posted on social platform X, Nepalese lawmaker Rajendra Bajgain last week warned that a 'vacuum created by reduced American involvement will inevitably be filled by other powers that do not share the values of democracy and free enterprise.' Two major US-funded infrastructure projects as well as other initiatives in Nepal have been put on hold following the US aid freeze, Reuters reported. In a response to a request for comment from CNN, China's Ministry of Foreign Affairs said that the US 'adjustments' were America's internal affairs, and that Beijing has 'consistently' provided assistance 'to the best of its ability.' China's aid 'aligns with the needs of recipient countries for socio-economic development and the improvement of people's livelihoods,' it said. But even as some of Trump's moves so far have created potential openings for Beijing, there's also the hanging question of how his administration may ultimately calibrate its aid and foreign policy – and its rivalry with China. When asked this month if the foreign aid shake-up was giving China and Russia an opportunity to expand their influence, national security adviser Mike Waltz told NBC's 'Meet the Press' that 'all too often these missions and these programs, number one, are not in line with strategic US interests like pushing back on China.' And speaking to European counterparts earlier this month, US defense chief Pete Hegseth warned that the US could no longer be 'primarily focused on the security of Europe.' Instead, the US is 'prioritizing deterring war with China in the Pacific,' he said. There have also been signs of Trump's brash diplomacy working against Beijing's benefit. Panama, the first country in Latin America to sign onto China's Belt and Road Initiative, announced it would pull out of the scheme after Trump repeatedly threatened to 'take back' the Panama Canal, falsely claiming Panama had ceded its operations to China. And in Europe, even as Trump officials lambasted European and NATO counterparts earlier this month and warmed to Russia, US allies there appeared galvanized, rather than dissuaded, to bolster NATO with more spending. That pivot will also mean Beijing is watching closely whether Washington is able to peel away its close ally Moscow, as the White House has signaled it may hope to do. Even still, Beijing will likely see the time as right to put more focus on repairing strained relations with Europe – a potential opening that could widen if Trump slaps tariffs on European goods. Trump has also so far not shaken US alliances in Asia, as Beijing may have hoped. And it's not clear that 'America First' will leave a security void in Asia or weaken the US alliance system there. The US president held seemingly successful meetings with Japanese Prime Minister Shigeru Ishiba and Indian counterpart Narendra Modi this month, and signaled support for the Pacific-focused AUKUS alliance of Canberra, London and Washington. And uncertainty or future demands from Trump could also strengthen arsenals and partnerships in the region. On Monday, US allies the Philippines and Japan agreed to further deepen their defense collaborations. Beijing, so far, has been seen as continuing to probe the limits of its own military muscle-flexing in the region, in recent days conducting what New Zealand said were unprecedented live-fire drills in the Tasman Sea. On Wednesday, Taiwan accused China of setting up a zone for 'live-fire training' without advance notice a day after the island's coast guard detained a Chinese-crewed cargo ship suspected of cutting an undersea cable in the Taiwan Strait. But Beijing will be carefully watching how Trump's policies and his allies' response to them weigh on its core ambitions to defend its territorial claims in the South China Sea – and take control of the self-ruling democracy of Taiwan. 'As long as the war in Europe would be put to an end, China's freedom of action in our part of the world might be more seriously checked and balanced,' said Shen in Shanghai. 'China must be watching, calculating how it should adjust its new approach to this fast-moving situation,' he said.
Egypt Independent
12-02-2025
- Business
- Egypt Independent
Trump wants China to play a role in peace in Ukraine. Is Xi Jinping willing to help?
Editor's Note: Sign up for CNN's Meanwhile in China newsletter which explores what you need to know about the country's rise and how it impacts the world. Hong Kong CNN — As the war in Ukraine grinds toward its fourth year, US President Donald Trump has made clear which world leader he thinks can help America end the conflict: As the war in Ukraine grinds toward its fourth year, US President Donald Trump has made clear which world leader he thinks can help America end the conflict: Vladimir Putin's ally Xi Jinping. 'Hopefully, China can help us stop the war with, in particular, Russia-Ukraine … they have a great deal of power over that situation, and we'll work with them,' Trump told political and business elites gathered at the World Economic Forum in Davos, Switzerland last month. Trump expressed that hope, he has repeatedly said, in a call with the Chinese leader days before being sworn in last month – and it's a subject that could be raised in the coming days as officials from around the world gather in Munich for an annual security conference. While Trump may have complicated his plan to orchestrate peace alongside Xi by imposing a blanket 10% tariff on Chinese imports into the United States earlier this month, the war in Ukraine could be a rare issue of collaboration – especially as Beijing looks to avert deepening trade frictions. 'Given the stakes on US-China relations, if Trump prices China's cooperation as the one critical issue that could improve US-China relations, I think China will be very tempted … (and could) play a helpful role,' said Yun Sun, director of the China Program at the Stimson Center think tank in Washington. At the same time, she added, Beijing will be wary of undermining its alignment with Russia. China has long sought to position itself as a potential peace broker in the conflict –promoting its own vaguely-worded proposal to settle the war. But in the West, its bid has so far been overshadowed by another reality: Beijing's abiding support for Putin's Russia. The stakes would be high for Xi to risk damaging that partnership, which the Chinese leader has built up as a critical part of his broader goals to counter pressure from the West and reshape a world order in China's favor. And a negotiating table where Xi has a prominent seat is also one where Putin, not Trump, has a staunch partner – a reality that Washington would have to navigate carefully if it doesn't want to risk isolating European allies or reach a solution that's unacceptable to Ukraine, analysts say. 'The real outcome that Beijing would like to avoid is a very much weakened Russia,' said Chong Ja Ian, an associate professor at the National University of Singapore. 'Because then … (Beijing) would be lacking one major partner.' A Ukrainian serviceman of 24th mechanized brigade trains in Ukraine's Donetsk region at the start of last year. Evgeniy Maloletka/AP An end in sight? The future of the conflict is expected to feature heavily on the agenda of the upcoming Munich Security Conference beginning Friday in Germany, where US Vice President JD Vance is set to meet with Ukrainian President Volodymyr Zelensky. Chinese Foreign Minister Wang Yi will also lead a delegation from Beijing. Looming over the gathering is a dramatic tone shift in Washington's approach to the war. Trump has questioned American aid to the embattled country, which his predecessor Joe Biden and US NATO allies have seen as critical to defending not just Ukraine's sovereignty and territorial integrity, but the rules-based world order. In a Fox News interview earlier this week, the notoriously transactional Trump instead suggested that the US should be getting access to Ukraine's rich natural resources in exchange for military assistance. He also suggested that Ukraine 'may be Russian someday,' and said his administration has made 'tremendous progress' in laying the groundwork for potential peace talks with Russia and Ukraine, without providing details. In a series of meetings in Europe this week US Secretary of Defense Pete Hegseth, Secretary of State Marco Rubio and Trump's envoy to Ukraine and Russia, Gen. Keith Kellogg will be urging their European and NATO counterparts to take on a much greater role in supporting Ukraine, defense officials and people familiar with the matter told CNN. Members of the Trump administration are also set to meet with Ukrainian officials in the coming days, with sources telling CNN that Treasury Secretary Scott Bessent is expected to travel to Kyiv for discussions about the country's critical mineral deposits, while Kellogg is also set to visit the country following meetings in Munich. Zelensky has said he is willing to negotiate with Putin – but only if the US and Europe continue to support Ukraine and 'provide security guarantees,' while Russia in recent days reiterated that it would only accept a peace that saw Ukraine give up ambitions to join NATO and cede regions annexed by Russia. But while Trump is pushing for a swift end to the war, his administration has yet to lay out specifics on what kind of peace terms they are hoping to see agreed upon. How much Trump would look to work alongside Xi – and whether the Chinese leader is amenable – may also depend to an extent on those parameters, observers say. Western leaders in the past have tried, without success, to persuade Xi to push Putin toward a peace in line with the one advocated for by Zelensky and Ukraine. Even as China has claimed neutrality in the conflict and called for peace, it's emerged as a key diplomatic and economic lifeline for Russia throughout the war, including by sending it dual-use goods NATO leaders have said are feeding Russia's defense sector and enabling its military. Beijing defends its trade as part of normal relations with Russia. It's likely that in Trump's eyes, all that gives Xi leverage over Putin. But close observers of China's foreign policy say it's not so straightforward. 'Can China threaten to cut off the supply (of essential goods to Russia)? It can't, because China cannot afford a completely failed Russia,' said Liu Dongshu, an assistant professor focusing on Chinese politics at the City University of Hong Kong. He pointed to Beijing's calculus that its relations with the US and Europe have already soured to such an extent that they have no choice but to continue to back their only powerful diplomatic ally. Xi and Putin memorably declared their 'no limits' partnership weeks before Russian tanks rolled over Ukraine's sovereign borders – a pledge made based on their shared opposition to NATO and a view that the US-led West is declining while they are on the rise. Xi also sees Putin as a potential source of economic and diplomatic support if Beijing were ever to invade Taiwan, some observers say. Xi's ambition to take control of the self-ruling democracy may be another key reason why he would be wary of any move that could harm that relationship. The Chinese leader may also be enjoying the war's role as a distraction for the US away from a focus on Asia and Taiwan – something the Trump's cohort, including Vice President Vance, have pointed out. As a US senator, Vance last year argued that the US supplying Ukraine with air defense systems could hurt its ability to aid Taiwan's defense if China were to attack the island that it claims as its own. Xi as peacemaker? Working with Trump to pressure Putin to a negotiating table – whatever the terms of a deal – would also mark a stark shift in Beijing's approach to the conflict so far. Xi and his officials have used the war as a platform to promote a vision for a China-led world, one where the American alliance system has been dismantled or weakened. 'China focuses on building a coalition of non-Western nations, including influential developing countries like Brazil, to leverage the Ukraine conflict toward reshaping global security architecture and advancing an alternative vision of world order,' said Tong Zhao, a senior fellow at the Carnegie Endowment for International Peace in the US. Beijing will have little incentive to engage in substantial cooperation with Washington for now, said Zhao, noting that its officials would, however, wait and see what benefits could be gained from any potential, broader deal-making with Trump. That said, the current American president – a NATO critic, who has repeatedly voiced personal admiration for Putin and Xi – may be a more appealing negotiating partner for both strongmen. Trump before taking office called for an 'immediate ceasefire and negotiations' – a position that jives with Beijing's stated stance on the war that has been criticized by the West as helpful to Russia. He's also in recent weeks echoed Moscow and Beijing's talking points, sympathizing with the Kremlin's view that Ukraine should not be part of NATO and that the war continued because America 'started pouring equipment' into Ukraine. US lawmakers and some members of Trump's administration remain tough on both countries. But Trump's stance raises the question of whether there is a deal that Beijing, Moscow and Washington could orchestrate that would please all three – and what that could mean for Ukraine and the future of the conflict. 'You can see how each could take something from (certain peace deals) – Putin can save face, Xi and Trump can claim to be peacemakers,' said Robert Ward, director of geo-economics and strategy at the International Institute for Strategic Studies in Britain. But there's a risk in any agreement where Russia is left in possession of the parts of Ukraine it's now occupying that this becomes 'a conflict that isn't at an end, it's just a lull,' he said.
Yahoo
12-02-2025
- Business
- Yahoo
Trump wants China to play a role in peace in Ukraine. Is Xi Jinping willing to help?
Editor's Note: Sign up for CNN's Meanwhile in China newsletter which explores what you need to know about the country's rise and how it impacts the world. As the war in Ukraine grinds toward its fourth year, US President Donald Trump has made clear which world leader he thinks can help America end the conflict: Vladimir Putin's ally Xi Jinping. 'Hopefully, China can help us stop the war with, in particular, Russia-Ukraine … they have a great deal of power over that situation, and we'll work with them,' Trump told political and business elites gathered at the World Economic Forum in Davos, Switzerland last month. Trump expressed that hope, he has repeatedly said, in a call with the Chinese leader days before being sworn in last month – and it's a subject that could be raised in the coming days as officials from around the world gather in Munich for an annual security conference. While Trump may have complicated his plan to orchestrate peace alongside Xi by imposing a blanket 10% tariff on Chinese imports into the United States earlier this month, the war in Ukraine could be a rare issue of collaboration – especially as Beijing looks to avert deepening trade frictions. 'Given the stakes on US-China relations, if Trump prices China's cooperation as the one critical issue that could improve US-China relations, I think China will be very tempted … (and could) play a helpful role,' said Yun Sun, director of the China Program at the Stimson Center think tank in Washington. At the same time, she added, Beijing will be wary of undermining its alignment with Russia. China has long sought to position itself as a potential peace broker in the conflict –promoting its own vaguely-worded proposal to settle the war. But in the West, its bid has so far been overshadowed by another reality: Beijing's abiding support for Putin's Russia. The stakes would be high for Xi to risk damaging that partnership, which the Chinese leader has built up as a critical part of his broader goals to counter pressure from the West and reshape a world order in China's favor. And a negotiating table where Xi has a prominent seat is also one where Putin, not Trump, has a staunch partner – a reality that Washington would have to navigate carefully if it doesn't want to risk isolating European allies or reach a solution that's unacceptable to Ukraine, analysts say. 'The real outcome that Beijing would like to avoid is a very much weakened Russia,' said Chong Ja Ian, an associate professor at the National University of Singapore. 'Because then … (Beijing) would be lacking one major partner.' The future of the conflict is expected to feature heavily on the agenda of the upcoming Munich Security Conference beginning Friday in Germany, where US Vice President JD Vance is set to meet with Ukrainian President Volodymyr Zelensky. Chinese Foreign Minister Wang Yi will also lead a delegation from Beijing. Looming over the gathering is a dramatic tone shift in Washington's approach to the war. Trump has questioned American aid to the embattled country, which his predecessor Joe Biden and US NATO allies have seen as critical to defending not just Ukraine's sovereignty and territorial integrity, but the rules-based world order. In a Fox News interview earlier this week, the notoriously transactional Trump instead suggested that the US should be getting access to Ukraine's rich natural resources in exchange for military assistance. He also suggested that Ukraine 'may be Russian someday,' and said his administration has made 'tremendous progress' in laying the groundwork for potential peace talks with Russia and Ukraine, without providing details. Members of the Trump administration are set to meet with Ukrainian officials in the coming days, with sources telling CNN that Treasury Secretary Scott Bessent is expected to travel to Kyiv for discussions about the country's critical mineral deposits. Trump's special envoy for Ukraine Keith Kellogg is also set to visit the country following meetings in Munich. Zelensky has said he is willing to negotiate with Putin – but only if the US and Europe continue to support Ukraine and 'provide security guarantees,' while Russia in recent days reiterated that it would only accept a peace that saw Ukraine give up ambitions to join NATO and cede regions annexed by Russia. But while Trump is pushing for a swift end to the war, his administration has yet to lay out specifics on what kind of peace terms they are hoping to see agreed upon. How much Trump would look to work alongside Xi – and whether the Chinese leader is amenable – may also depend to an extent on those parameters, observers say. Western leaders in the past have tried, without success, to persuade Xi to push Putin toward a peace in line with the one advocated for by Zelensky and Ukraine. Even as China has claimed neutrality in the conflict and called for peace, it's emerged as a key diplomatic and economic lifeline for Russia throughout the war, including by sending it dual-use goods NATO leaders have said are feeding Russia's defense sector and enabling its military. Beijing defends its trade as part of normal relations with Russia. It's likely that in Trump's eyes, all that gives Xi leverage over Putin. But close observers of China's foreign policy say it's not so straightforward. 'Can China threaten to cut off the supply (of essential goods to Russia)? It can't, because China cannot afford a completely failed Russia,' said Liu Dongshu, an assistant professor focusing on Chinese politics at the City University of Hong Kong. He pointed to Beijing's calculus that its relations with the US and Europe have already soured to such an extent that they have no choice but to continue to back their only powerful diplomatic ally. Xi and Putin memorably declared their 'no limits' partnership weeks before Russian tanks rolled over Ukraine's sovereign borders – a pledge made based on their shared opposition to NATO and a view that the US-led West is declining while they are on the rise. Xi also sees Putin as a potential source of economic and diplomatic support if Beijing were ever to invade Taiwan, some observers say. Xi's ambition to take control of the self-ruling democracy may be another key reason why he would be wary of any move that could harm that relationship. The Chinese leader may also be enjoying the war's role as a distraction for the US away from a focus on Asia and Taiwan – something the Trump's cohort, including Vice President Vance, have pointed out. As a US senator, Vance last year argued that the US supplying Ukraine with air defense systems could hurt its ability to aid Taiwan's defense if China were to attack the island that it claims as its own. Working with Trump to pressure Putin to a negotiating table – whatever the terms of a deal – would also mark a stark shift in Beijing's approach to the conflict so far. Xi and his officials have used the war as a platform to promote a vision for a China-led world, one where the American alliance system has been dismantled or weakened. 'China focuses on building a coalition of non-Western nations, including influential developing countries like Brazil, to leverage the Ukraine conflict toward reshaping global security architecture and advancing an alternative vision of world order,' said Tong Zhao, a senior fellow at the Carnegie Endowment for International Peace in the US. Beijing will have little incentive to engage in substantial cooperation with Washington for now, said Zhao, noting that its officials would, however, wait and see what benefits could be gained from any potential, broader deal-making with Trump. That said, the current American president – a NATO critic, who has repeatedly voiced personal admiration for Putin and Xi – may be a more appealing negotiating partner for both strongmen. Trump before taking office called for an 'immediate ceasefire and negotiations' – a position that jives with Beijing's stated stance on the war that has been criticized by the West as helpful to Russia. He's also in recent weeks echoed Moscow and Beijing's talking points, sympathizing with the Kremlin's view that Ukraine should not be part of NATO and that the war continued because America 'started pouring equipment' into Ukraine. US lawmakers and some members of Trump's administration remain tough on both countries. But Trump's stance raises the question of whether there is a deal that Beijing, Moscow and Washington could orchestrate that would please all three – and what that could mean for Ukraine and the future of the conflict. 'You can see how each could take something from (certain peace deals) – Putin can save face, Xi and Trump can claim to be peacemakers,' said Robert Ward, director of geo-economics and strategy at the International Institute for Strategic Studies in Britain. But there's a risk in any agreement where Russia is left in possession of the parts of Ukraine it's now occupying that this becomes 'a conflict that isn't at an end, it's just a lull,' he said. CNN's Mariya Knight, Maria Kostenko, Frederik Pleitgen, Katharina Krebs, and Caitlin Danaher contributed to this report.
Egypt Independent
10-02-2025
- Business
- Egypt Independent
The first shots of a potential trade war have been fired. What's next for Beijing?
Editor's Note: Sign up for CNN's Meanwhile in China newsletter which explores what you need to know about the country's rise and how it impacts the world. Hong Kong CNN — The first return volley in a new trade clash between China and the United States was fired on Monday as Beijing's tariffs on nearly $14 billion in US imports came into effect. Those tariffs – which covered duties on crude oil, liquefied natural gas and some machinery and vehicles – began less than a week after US President Donald Trump imposed blanket 10 percent duties on the hundreds of billions in goods that the US imports from China every year. There were hopes that a phone call between Trump and Chinese leader Xi Jinping last week could have avoided an escalation in hostilities, which could lead to a broader trade war. But that conversation never materialized. Now the question for both sides is what happens next. And how far each of the world's two largest economies is willing to strain their deeply integrated commercial and trade ties. So far, even with the opening salvo discharged, both sides appear to be leaving breathing room for a potential deal. 'Beijing has been restrained in its response to the new Trump tariffs. Both because the impact on China is modest, and because Xi wants to leave room to negotiate with Trump,' said Andy Rothman, CEO of advisory group Sinology. Room for a deal? China's tariffs – a 15 percent tax on certain types of coal and liquefied natural gas and a 10 percent tariff on crude oil, agricultural machinery, and some vehicles – affect about $13.86 billion in goods, according to a CNN calculation based on China's 2024 customs data. Altogether, that makes up less than 9 percent of China's overall imports from the US. China had over $524 billion in exports to the US last year and imported over $163 billion from the US, according to its customs data. Beijing last week also announced export controls with immediate effect on some raw materials used in defense and green tech sectors, as well as measures targeting a few US companies. Trump's newest tariffs, meanwhile, are mild compared with the upwards of 60 percent duties that he had threatened to place on China while on the campaign trail. They add to existing tariffs on hundreds of billions in Chinese imports. The US president campaigned on evening the economic playing field with China and has said he's open to a deal. Last month, he told political and business elites gathered in Davos, Switzerland that he's 'always liked' Xi and looked forward to 'getting along with China.' 'Trump appears to be in dealmaking mode, using tariffs as a negotiating tool … It is not clear, however, what Trump wants from Xi, and what he is willing to offer in return,' Rothman said. So far, observers of China's elite politics say Xi and his officials are likely to be relieved by the tenor of the Trump administration and the limited action so far. 'They were preparing for 60 percent tariffs and complete decoupling … nothing has happened that's even close to the worst case scenario,' said Suisheng Zhao, director of the Center for China-US Cooperation at the University of Denver. But another deadline, April 1, hangs over those talks. That's the date by which Trump has ordered his officials to deliver a probe into US-China economies ties, which could trigger even more action. Officials in Beijing will now be focused on carefully managing the messages they send to the Trump administration in their diplomacy and in trade measures, as they seek to avert a more pointed trade war. They're also likely to be keen to seize on any opportunities to use personal rapport between Trump and Xi to persuade the US president from deepening penalties on the Chinese economy – which economists and analysts say would also deliver a heavy blow to the US economy. That could mean Beijing is keen to welcome the American president for face-to-face meetings in Beijing, something sources told CNN last month that Trump was interested in doing. '(Chinese leaders) don't want to see escalation … China's leverage is not as strong as the United States, so they must take all the opportunities they could to try to pacify Trump and to let Trump make enemies of other countries,' Zhao said. Chinese leader Xi Jinping welcomes US President Donald Trump to Beijing on November 9, 2017. Damir Sagolj/Reuters Penalties and concessions? Even as Beijing may be focused on how to avert a deepening trade war, there's no question that the country's officials have been carefully preparing contingencies – and weighing up potential penalties to impose and concessions to make if Trump escalates further. 'Trump's trade actions will force Beijing to respond, but with a more targeted touch this time around, rather than the sweeping tit-for-tat actions that we saw in 2018 to 2019 when the trade war first erupted,' said Nick Marro, principal economist for Asia at Economist Intelligence Unit. Late last year, the country revamped its export control regulations, sharpening its ability to restrict so-called dual-use goods as well as raw materials and critical minerals, some of which the US sees as essential for economic or national security. Analysts have estimated that China controls 60 percent of world-wide production and 85 percent of processing capacity of critical minerals. Beijing will be evaluating the pain versus gain of announcing further controls on such goods, as well as additional tariffs, observers say, alongside ways to protect its own economy, which suffers from slowing growth, persistent deflation and weak consumer demand. China is also better prepared in some ways for trade frictions than it was during Trump's first term, analysts say. Chinese firms have worked to diversify export destinations, while Beijing has mounted a campaign to shore up or repair its relations with other trading partners – an opportunity that expands for Beijing whenever Trump raises frictions with US allies and partners. But perhaps a thornier question is what China would or could concede in any substantive negotiations with the US on a trade deal. Analysts say Beijing never fully implemented the phase one trade deal reached at the end of the first Trump administration, while US concerns extend further into China's industrial policy and economic model. 'Given the failure of past negotiations, the US's appetite for a sweeping deal – one that goes beyond micro-level discussions, like the future of TikTok – doesn't seem very strong these days,' said Marro, referring to the Chinese-owned app facing a US ban. 'That's going to minimize any potential off-ramp.'
Yahoo
10-02-2025
- Business
- Yahoo
The first shots of a potential trade war have been fired. What's next for Beijing?
Editor's Note: Sign up for CNN's Meanwhile in China newsletter which explores what you need to know about the country's rise and how it impacts the world. The first return volley in a new trade clash between China and the United States was fired on Monday as Beijing's tariffs on nearly $14 billion in US imports came into effect. Those tariffs – which covered duties on crude oil, liquified natural gas and some machinery and vehicles – began less than a week after US President Donald Trump imposed blanket 10% duties on the hundreds of billions in goods that the US imports from China every year. There were hopes that a phone call between Trump and Chinese leader Xi Jinping last week could have avoided an escalation in hostilities, which could lead to a broader trade war. But that conversation never materialized. Now the question for both sides is what happens next. And how far each of the world's two largest economies is willing to strain their deeply integrated commercial and trade ties. So far, even with the opening salvo discharged, both sides appear to be leaving breathing room for a potential deal. 'Beijing has been restrained in its response to the new Trump tariffs. Both because the impact on China is modest, and because Xi wants to leave room to negotiate with Trump,' said Andy Rothman, CEO of advisory group Sinology. China's tariffs – a 15% tax on certain types of coal and liquefied natural gas and a 10% tariff on crude oil, agricultural machinery, and some vehicles – affect about $13.86 billion in goods, according to a CNN calculation based on China's 2024 customs data. Altogether, that makes up less than 9% of China's overall imports from the US. China had over $524 billion in exports to the US last year and imported over $163 billion from the US, according to its customs data. Beijing last week also announced export controls with immediate effect on some raw materials used in defense and green tech sectors, as well as measures targeting a few US companies. Trump's newest tariffs, meanwhile, are mild compared with the upwards of 60% duties that he had threatened to place on China while on the campaign trail. They add to existing tariffs on hundreds of billions in Chinese imports. The US president campaigned on evening the economic playing field with China and has said he's open to a deal. Last month, he told political and business elites gathered in Davos, Switzerland that he's 'always liked' Xi and looked forward to 'getting along with China.' 'Trump appears to be in dealmaking mode, using tariffs as a negotiating tool … It is not clear, however, what Trump wants from Xi, and what he is willing to offer in return,' Rothman said. So far, observers of China's elite politics say Xi and his officials are likely to be relieved by the tenor of the Trump administration and the limited action so far. 'They were preparing for 60% tariffs and complete decoupling … nothing has happened that's even close to the worst case scenario,' said Suisheng Zhao, director of the Center for China-US Cooperation at the University of Denver. But another deadline, April 1, hangs over those talks. That's the date by which Trump has ordered his officials to deliver a probe into US-China economies ties, which could trigger even more action. Officials in Beijing will now be focused on carefully managing the messages they send to the Trump administration in their diplomacy and in trade measures, as they seek to avert a more pointed trade war. They're also likely to be keen to seize on any opportunities to use personal rapport between Trump and Xi to persuade the US president from deepening penalties on the Chinese economy – which economists and analysts say would also deliver a heavy blow to the US economy. That could mean Beijing is keen to welcome the American president for face-to-face meetings in Beijing, something sources told CNN last month that Trump was interested in doing. '(Chinese leaders) don't want to see escalation … China's leverage is not as strong as the United States, so they must take all the opportunities they could to try to pacify Trump and to let Trump make enemies of other countries,' Zhao said. Even as Beijing may be focused on how to avert a deepening trade war, there's no question that the country's officials have been carefully preparing contingencies – and weighing up potential penalties to impose and concessions to make if Trump escalates further. 'Trump's trade actions will force Beijing to respond, but with a more targeted touch this time around, rather than the sweeping tit-for-tat actions that we saw in 2018 to 2019 when the trade war first erupted,' said Nick Marro, principal economist for Asia at Economist Intelligence Unit. Late last year, the country revamped its export control regulations, sharpening its ability to restrict so-called dual-use goods as well as raw materials and critical minerals, some of which the US sees as essential for economic or national security. Analysts have estimated that China controls 60% of world-wide production and 85% of processing capacity of critical minerals. Beijing will be evaluating the pain versus gain of announcing further controls on such goods, as well as additional tariffs, observers say, alongside ways to protect its own economy, which suffers from slowing growth, persistent deflation and weak consumer demand. China is also better prepared in some ways for trade frictions than it was during Trump's first term, analysts say. Chinese firms have worked to diversify export destinations, while Beijing has mounted a campaign to shore up or repair its relations with other trading partners – an opportunity that expands for Beijing whenever Trump raises frictions with US allies and partners. But perhaps a thornier question is what China would or could concede in any substantive negotiations with the US on a trade deal. Analysts say Beijing never fully implemented the phase one trade deal reached at the end of the first Trump administration, while US concerns extend further into China's industrial policy and economic model. 'Given the failure of past negotiations, the US's appetite for a sweeping deal – one that goes beyond micro-level discussions, like the future of TikTok – doesn't seem very strong these days,' said Marro, referring to the Chinese-owned app facing a US ban. 'That's going to minimize any potential off-ramp.' CNN's Fred He and Joyce Jiang contributed to this report.
