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The temporary halt to US tariffs decided by President Donald Trump has certainly not changed the minds of several analysts about the role China is playing in this matter.
A STARS AND STRIPES RING
The dragon, in fact, according to various international newspapers and analysts, is none other than Trump’s real target and, should he achieve his goals, would also be ready to backtrack (this time for good) with the rest of the world. An analysis that certainly looks at the tycoon’s movements, statements and actions not only in this legislature, but also in the years of his first presidency. Without forgetting the indiscretions that have emerged in recent days from the pages of the Wall Street Journal. According to the economic newspaper, in fact, Trump’s emissaries in the dialogues to be opened with more than 70 countries around the globe, all aimed at seeing the USA reduce their tariffs, will strongly focus on relations with China. The central element will be the reassurance from these countries that not only they will not supply themselves in the Made in China market, but above all that they will not make it possible for goods from the dragon to pass through their territories, so as to circumvent and evade the tycoon’s duties. The objective behind this strategy would be to put the United States in a higher position at an eventual negotiating table with Xi Jinping. Indeed, President Trump’s hope would be to weaken the Chinese economy and force China to negotiate. This is especially true if the various countries with which the US will open negotiations commit to not taking advantage of loopholes for Chinese products.
THE DRAGON’S MOVE
Of course, in the international arena, China is not standing idly by. There is no reason for Xi Jinping to go down the road of negotiation with Donald Trump, certainly not in the short or medium term. For China, in fact, the game should all be played by calling the US President’s bluff, while keeping domestic morale high, which is done by assuring that the country would possess sufficient tools to counter Trump’s trade war. For Beijing, it is not an open war, but rather a series of useful measures to counter the tycoon’s moves. The counter-duties have of course been imposed. It could not have been done otherwise, especially after Trump’s statements. However, there have been other initiatives, such as the control over the export of rare earths, or the increasing control over the operations of stars and stripes companies operating in China. A kind of ‘soft’ retaliation that, while it could at least dent the screen of duties imposed by the US, at the same time may present foreign investors with a strategy that is anything but inviting. All this at a time when Beijing cannot afford to lose foreign investment. There are, therefore, two other strategies contained in the moves that the dragon will implement in the short and medium term. Firstly, policies (already announced by some analysts attentive to Chinese dynamics) aimed at increasing domestic consumption. Then, the acceleration of the drafting of trade agreements first and foremost with the closest partners. Xi Jinping’s recent trips to Vietnam, Malaysia and Cambodia are part of this line, as is the attempt to achieve the unblocking of the China-Japan-South Korea free trade agreement.
THE ROLE OF THE OLD CONTINENT
Still on the Chinese side, there remains the need to increasingly broaden the dialogue with the European Union. A real chessboard on which the two great powers will face each other. On the one hand, Xi Jinping will try to find new outlets in European markets and also ways to circumvent US duties. On the other is Trump’s willingness to use the Chinese bogeyman in the negotiations on the reduction of duties. In the middle are the European Union member states who, once again, will find themselves in the difficult position of choosing a firm and united response, or to face this new international conjuncture without following a shared plan.