Taipei, Taiwan – As US President Donald Trump launches a new trade conflict with China, experts predict he will confront a more formidable and prepared opponent in Beijing, compared to his initial term in office.

Since returning to the White House in January, Trump has already enforced a 20 percent tariff on Chinese imports, attributing it to Beijing’s alleged failure to curb the export of the deadly opioid fentanyl to the US.

This tariff adds to previous levies imposed by Trump and former US President Joe Biden on over $400 billion worth of Chinese goods.

Following the condemnation of the latest US tariffs by Beijing as “bullying” and “intimidation,” China retaliated last week by announcing tariffs ranging from 10-15 percent on various US agricultural goods, including corn, beef, pork, dairy, and soybeans.

These tariffs, effective from this Monday, follow Beijing’s announcement last month of a 10 percent tariff on crude oil, agricultural machinery, pick-up trucks, and some cars, alongside a 15 percent tariff on coal and liquefied natural gas.

Chinese Foreign Ministry Spokesperson Lin Jiang stated, “If war is what the US wants, be it a tariff war, a trade war, or any other type of war, we’re ready to fight till the end.”

While these tit-for-tat measures recall Trump’s initial trade war in 2018, both Washington and Beijing face very different conditions today compared to seven years ago.

Over the years, the world’s two largest economies have gradually decoupled, diminishing their mutual dependency and mitigating the impact of tariffs, according to analysts.

Christopher Beddor, a deputy China research director at Beijing-based Gavekal Dragonomics, commented that the latest tariffs should be “pretty manageable” for China and are significantly below the 60 percent rate threatened by Trump during his election campaign.

China’s share of total US trade dropped from 15.7 percent to 10.9 percent between 2018 and 2024, and the US’s share of China’s total trade fell from 13.7 percent to 11.2 percent over the same period, as reported by Bloomberg.

Lynn Song, chief Economist for Greater China at ING, stated that Beijing is not likely to panic over the tariffs – at least for now.

Chinese exporters such as Shein and Temu have found success in selling low-cost goods directly to customers by taking advantage of a tariff exemption on shipments worth less than $800.

Beijing has continued to implement measures to safeguard the economy from trade shocks.

At the “Two Sessions” meetings last week in Beijing, the National People’s Congress announced several fiscal stimulus measures, including raising the debt level for local governments and issuing 1.3 trillion yuan ($179bn) in long-term treasury bonds.

Carsten Holz, an expert on the Chinese economy at the Hong Kong University of Science and Technology, stated, “Even the effect of a complete Trump ban on imports from China – hardly realistic in an age when, for example, the bulk of iPhones are produced in China – may not make a dent larger than a fraction of a percentage point in China’s GDP.”

Some analysts believe that despite its stronger position compared to 2018, Beijing is still open to negotiating with Trump – at least for the moment.

Chinese officials’ response, which includes moderate tariffs on a limited number of goods, suggests a strategy aimed at “avoiding escalation.”

Beijing may be seeking a “phase two” deal similar to the “phase one” agreement reached with Trump in 2020 to end the first trade war.

Under the phase one deal, China pledged to purchase $200 billion in US goods and services, including agricultural products, over two years.

John Gong, a professor of economics at the University of International Business and Economics in Beijing, agreed that China can withstand the pressure but is also willing to negotiate.

Analysts also believe that Trump may be at risk of overplaying his hand.

During the previous trade war, Trump focused solely on China, but upon returning to office, he has expanded his focus to include other countries like Mexico and Canada.

Trump has moved at lightning speed, rolling out tariffs on goods worth $1.4 trillion in about a month, compared to tariffs on imports worth $380 billion in 2018 and 2019.

It remains unclear to what extent Trump’s tariffs will remain in place.

Just two days after imposing sweeping tariffs on Canada and Mexico on March 4, Trump announced a delay in duties on many imports until April 2.

Gavekal Dragonomics’ Beddor commented, “[China’s] approach is: let’s wait and see, apply more fiscal stimulus to mitigate the impact.”

Source: https://www.aljazeera.com/news/2025/3/11/why-china-isnt-as-worried-about-trumps-trade-war-as-in-2018?traffic_source=rss