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Trump’s big gift to Xi Jinping: how China benefits from tariffs and the trade war

Trump manages in his own way to unite a world that has learned from the US - easily or hardly - that it must be opposed to Beijing and its aspirations.

Newsroom April 10 08:48

 

For Donald Trump, the war with China – on trade and economic terms – is all he has wanted to fight since 2016 with him at the helm. For the US President, the economy is everything – or almost everything – and rightly since the late 1980s he had foreseen and publicly spoken – not from a position of responsibility, of course – about the danger of China’s rise and the threat it poses to American economic and not only economic sovereignty. Trump, with a fresh second term in the oval office and, having been forced to scale back his plans because of the pandemic during his first time in the White House, is doing exactly what he had announced: economic warfare.

The tariffs no matter how Trump has interpreted the issues is a clear tool – a weapon that the US and every other level economy has in its quiver. The US President has chosen to use it at a time when the problems are neither few nor small and in a year in which the US economy has enough of its own to deal with. The impact for the US President is synonymous with the “side effects” of a serious surgery that a seriously ill person has to deal with. Pain is necessary and to be fair and in fairness to both the circumstances and the story itself Trump had spoken about it without equivocation…

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What seems to be of little concern to the American President, however, and seems to be repeating as a pattern, is the fact that beyond the purely macro or even micro economics, Trump is making moves that directly “tear down” efforts and policies that his country has fought for, paid for and established through pure – or not so pure – methods over the last 80 years. US moves today show a violent shift to isolationism. Trump is attempting to turn the US ocean liner which, with many knots, is charting a long course in just a few miles and with no problem apparent on the horizon beyond the captain’s orders.

Trump claims that his country’s “ship” is headed for the shoals and reefs of Peking which are currently of such a size that they could “wound” and sink the ship… Trump’s data is right on the part of diagnosing the problem. Yes, China today is by far the top threat to the US economy and it won’t be long before Beijing takes advantage of the circumstances to emerge as the new global superpower. But Trump, in the way he chooses to go about it, is making a huge gift to his own enemy… As mentioned above this is not the first time he has done so and in less than three months. The same questions have been raised by his attitude in the Ukraine War with his approach to Moscow and his isolation of Ukraine and Europe. In his own way, Trump is succeeding in uniting a world that has learned from the US – easily or not so easily – that it must stand against China and Beijing’s ambitions. Really, if three months ago someone had said that China – Japan and South Korea would hurriedly even be at the same table to find a common solution against the US tariff threat, how many would have bet in favour?

The tariffs,regardless of the final height they reach with Trump dealing exclusively with Beijing and wanting to “drag” Xi onto a Washington-bound aircraft, will also hurt the China economy as a matter of fact. But China’s stance clearly shows that this is precisely the cost that Beijing has no problem paying. The statements from the Chinese government are announcements from a country that is defending itself, not a country that has for years been the “black sheep” of the World Trade Organization with thousands of complaints and lawsuits against illegal trade practices and the circumvention of every norm and ethic in intellectual property. Trump’s tariffs additionally give a new narrative to China on its domestic issues. With the average pension at $17 a month and a recent $3 raise, China is more threatened at home than on the other side of the Atlantic. The given and officially declared trade war by Washington is the perfect alibi…

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