Beijing’s Preparations for Trump’s  Second Term

As Donald Trump returns to the White House, China is recalibrating its strategies, diverging from the confrontational responses it employed during his first term. In response to the past trade wars sparked by Trump’s tariffs and aggressive rhetoric, Beijing focuses on bolstering economic resilience, advancing technological independence, and strengthening alliances to reduce potential fallout. With Trump’s renewed tariff threats, Chinese policymakers are prioritizing strategies to exploit divisions within U.S. alliances and aim for a more diplomatic approach, experts suggest.

China’s Approach: Avoiding Confrontation and Seeking Stability

Zhao Minghao, an international relations expert at Fudan University, highlights China’s adjusted stance. “Trump is not a stranger to Beijing this time,” he notes, suggesting that China’s response to potential U.S. tariffs will be more measured. Zhao points to President Xi Jinping’s recent emphasis on “cooperation, not confrontation,” underscoring Beijing’s commitment to stabilizing U.S.-China relations, even as challenges persist.

However, Trump’s pledges to revoke China’s most-favored-nation status and implement tariffs up to 60% on Chinese imports have unsettled key Chinese industries dependent on U.S. trade. While some form of retaliation may be unavoidable, analysts believe Beijing may temper its response, aiming for early trade deals to shield its economy from deeper economic shocks.

The Impact of New Tariff Threats on China’s Economy

Despite efforts to strengthen economic independence, China’s economy—strained by a property market crisis and slow growth—faces vulnerabilities. Trump’s tariff threats have triggered concern among Chinese exporters, who send over $400 billion in goods to the U.S. each year. These vulnerabilities could limit China’s ability to respond effectively. According to Li Mingjiang from Singapore’s Rajaratnam School of International Studies, a renewed trade clash might require even more substantial economic stimulus than the $1.4 trillion currently anticipated from the Chinese government.

Global Outreach: China’s Charm Offensive

China has launched a diplomatic campaign to strengthen alliances across Europe, Asia, and the Global South to reduce its dependence on U.S. trade. Recent diplomatic initiatives include resolving longstanding disputes with India and Japan and advancing trade talks with the European Union despite ongoing tensions. China’s leaders have also engaged with BRICS and the Shanghai Cooperation Organisation, seeking to deepen ties with emerging economies that now represent a substantial share of the global economy.

Eric Olander, editor-in-chief of the China-Global South Project, points out that Trump’s previous administration largely neglected regions like Africa, Latin America, and Southeast Asia, enabling China to establish a stronger foothold. In Europe, China’s outreach efforts may find support from concerns over Trump’s potential reduction in Ukraine conflict support, prompting European nations to maintain warmer ties with Beijing.

Technological Independence: China’s Shift Away from U.S. Imports

The 2018 U.S. export ban on critical components to Chinese telecommunications giant ZTE underscored vulnerabilities within China’s tech sector, sparking a drive for self-reliance. Over the past eight years, China has made significant progress in domestic tech production, with government projects dedicated to replacing foreign technology now numbering 169—an impressive jump from just four projects in 2016. While Beijing’s tech industry has made strides in independence, U.S. export controls continue to restrict access to advanced chips, limiting China’s competitiveness on the global stage.

Former Commerce Department official Nazak Nikakhtar, who served during Trump’s term, expects even stricter U.S. export restrictions targeting Chinese tech in a second Trump administration. These restrictions could significantly impact China’s tech industry and its ability to compete globally. “We’ll likely see an expanded entity list affecting more companies and their affiliates,” she noted, projecting far-reaching consequences for Chinese suppliers and the broader tech supply chain.

Outlook: Navigating a New Chapter in U.S.-China Relations

As China braces for the potential challenges of another Trump presidency, its strategies reflect a shift toward economic self-sufficiency and strategic diplomacy. The coming years may mark a critical phase in U.S.-China relations, with Beijing focused on strengthening global partnerships and reinforcing its tech sector to withstand future economic pressures. This potential shift in relations could herald a new chapter in the global geopolitical landscape.