U.S. President Donald Trump has widened his tariff playbook, unleashing a string of warnings and policy moves that affect Beijing’s interests without directly escalating tariffs on Chinese goods.
But analysts are hopeful that the recent geopolitical turmoil is unlikely to unravel the delicate U.S.-China trade truce, as Beijing appears to be betting that Trump’s threats will not be enforced in ways that meaningfully harm China. Both sides are seeking to keep plans on track for an upcoming leaders meeting in April.
“Beijing is watching,” but is likely to respond cautiously to Trump’s latest tariff threats, said Deborah Elms, head of trade policy at the Hinrich Foundation. She said Trump is unlikely to follow through on threats, such as imposing 100% tariffs on Canada, or on many of his other warnings to trade partners.
“There is no reason to provoke any other reaction from Washington at this time [as] both the U.S. and China are trying to maintain the fragile truce through Trump’s planned visit to China in April,” Elms added.
Gabriel Wildau, managing director at consultancy firm Teneo, said Chinese leaders may doubt Trump will follow through on his latest tariff threats, given that he has largely retreated from earlier measures after backlash from financial markets and the business community.
