As Donald Trump’s return to the US presidency loomed over Chinese officials, the anticipation of dire news regarding tariffs on exports was palpable. However, the actual outcome was milder than expected. Trump’s initial move was to launch an investigation into US-China trade, followed by a mention of a potential 10 per cent tariff related to fentanyl. While this news was enough to impact China’s stocks and currency, it was less severe compared to the tariffs imposed on US allies Mexico and Canada.
Amidst Trump’s unpredictable statements and policy shifts, there is a glimmer of hope in Beijing for potential negotiations to prevent another trade war. The pivotal question now hinges on finding a mutually acceptable deal between the two economic powerhouses.
Key Points:
- Trump and China’s President Xi Jinping engaged in a phone call before the inauguration, signaling potential for dialogue.
- TikTok, a contentious issue, could be a linchpin in broader negotiations.
- Tariffs and trade relations between the US and China remain on a delicate precipice.
- Chinese officials maintain a cautious approach, ready to respond if relations deteriorate.
Although Trump’s recent actions suggest a more conciliatory approach towards China, experts caution that the underlying hawkish sentiment within his administration persists. While conversations around TikTok’s ownership could lay the groundwork for collaboration on other fronts, the specter of a trade conflict still looms large.
There is a glimmer of hope for diplomatic resolutions beyond trade, such as collaboration on international issues like the Ukraine conflict. However, the shadow of potential tariff hikes necessitates China’s preparedness to defend its interests if the situation escalates.
As the global economic landscape navigates these turbulent waters, the future of US-China relations hangs in a delicate balance, waiting to be shaped by the outcomes of strategic negotiations and policy decisions.
