It is simultaneously preparing the Chinese people to strap in for tough times while assuring them the “the sky will not fall”.
“China is a super economy. We are strong and resilient in the face of the US tariff bullying,” said a recent commentary in the People’s Daily, the Chinese Communist Party’s official newspaper.
Seasoned China watchers don’t expect Xi to buckle.
“The US and China are locked in a game of chicken like two race cars driving directly toward each other. Whoever swerves first will stand to lose prestige and profit,” political scientist Wen Ti-Sung said in an online analysis.
Arthur Kroeber, a China expert at consultancy firm Gavekal Research, said Trump, through his ratcheting tariffs, had in effect committed to ending US trade with China.
“What comes next from Beijing is almost certainly further retaliation, both in the form of additional tariffs and, most likely, the extension of export controls and the targeting of more US companies for investigations of various kinds. At this point, China has little to lose,” Kroeber said in a research note.
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America, once the bastion of free-market evangelism, under Trump has embraced the cudgels of economic coercion that the West has, until now, been more inclined to associate with Beijing – as Australia, and its lobster industry, knows all too well.
Where this ends is difficult to predict. From a geopolitical perspective, Trump’s worldwide trade assault on almost every country – regardless of past alliances, and whether populated by people or penguins – has delivered a gift to Beijing.
It has been marketing itself as a beacon of stability and a partner of choice in a world of Trump-driven chaos.
“The window is closed for China and the United States to have any meaningful material conversation or negotiation,” said Chucheng Feng, from Hutong Research, an independent consultancy in Beijing. “China will be taking this opportunity to solidify its partnerships, especially trade partnerships, with the rest of the world.”
Even for close allies such as Australia, whose economy is heavily tied to China’s, calls to reassess the marriage with the US – views once dismissed by hawks as fringe – have, in light of questions about America’s reliability, entered the mainstream.
So much for the Art of the Deal.
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