Expert Take: What Trump 2.0 Means for China
January 15, 2025
The world is closely watching President Trump as he embarks on his second term, following a whirlwind of campaign pledges. For this series, we turned to Basilinna’s network of over 50 experts to share their insights on what this next chapter could mean for their sectors and regions.
Expert Take from Basilinna’s Chair of Asia-Pacific, Gracie Sun
What does the second Trump administration mean for China?
It is clear from the group of nominees Trump rapidly named to key positions that his second Administration will continue to be tough on China. But the approach will be different from Biden’s and could also be practical on certain issues.
President Xi Jinping of China and President Donald Trump during a state visit in Beijing, Nov. 9, 2017. Source: Doug Mills / The New York Times
The Chinese side fully expects the Trump Administration to raise tariffs on Chinese goods, review China’s permanent normal trade relations (PNTR) status, and retain the U.S.’s competitive advantage on advanced technologies like chip technology and AI. They have already been preparing various countermeasures, some of which are already being rolled out, such as China’s own export control and sanctions regime.
The tit-for-tat trade war is likely to expand beyond the reciprocal tariff actions from Trump’s first term.
That said, there may be opportunities for collaboration. Some of Trump’s associates and supporters would prefer a stable relationship with China for both business and economic interests. Given Trump’s transactional nature, he may view tariffs as a bargaining chip to maximize negotiations with China and secure trade and business deals.
Source: McKinsey & Company
Also, China’s leaders prefer a predictable relationship with the U.S. as they tackle an economic slowdown, industrial overcapacity, weak demand, and a complicated geopolitical landscape.
U.S. President Elect Donald Trump and Chinese President Xi Jinping-Qilai Shen. Source: Bloomberg
It’ll be important to see if and how the Trump administration maintains bilateral dialogue mechanisms to manage the relationship.
Without a clear Dr. Kissinger-like figure, Beijing is looking for interlocutors who can serve as a reliable channel to the White House. However, after experiencing the unpredictability of Trump’s first administration, Chinese policymakers are also realistic and prepared for unexpected outcomes.
what trump 2.0 means for the world
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