This is not in the plans of D grader Trump when he launched his trade wars, sanctions and tariffs against China and the world. He is still believing that trade wars are easy to win, and he is winning, America is winning, and the hillbillies, rednecks and MAGA supporters are the beneficiaries, all popping champagne and celebrating his victory.
It would not have occurred in Trump's pea brain that what he was doing would instead be making China the biggest winner in his silly Art of Deal or Steal. Trump have stolen hundreds of billions from the average Americans from the tariffs imposed. No country is paying for it, definitely not China.
China is benefitting from this trade war in many ways. Trump has offerred many markets to China on a silver platter by sanctioning and isolating these countries, forcing them to turn to China. China became the monopolistic suppliers of all goods, services, technologies and everything that these countries need. Russia, Iran, Venezuela, Cuba, Afghanistan, to just name a few. In these countries, everything is Chinese, Made in China, from household items, consumer electronics, computers, computer software and hardware, Huawei's 5G communication system, automobiles, EVs etc etc. China does not need to do anything, there were no challengers or competitors, no American made goods and service, not even from American allies and crony countries. They were also coerced to stop trading with these countries.
When China has complete monopolies in these countries, and those of the Global South, China could test new product lines and services and let them grow, undisturbed, like incubators or laboratories, and make a name for themselves, establish their brand's name, allowing the users to get use to Chinese goods and services all over the place...and no competitors, no alternatives, no substitutes. How else could China clocked US$1.2 trillion trade surplus with declining trades with America and Europe?
In another way, the tariffs also make all American products and services more expensive for the rest of the world when they needed to import and use Chinese parts and components from China ... at higher prices. It is a double whammy for the Americans and the Europeans. Trump is actually clearing the field of all competitors to allow Chinese companies to flourish and sell their products and services in a free market minus America and Europe. Trump wipes the plate clean for China to fill in.
China cannot hope for anything better, no advertising cost, no need to pay Trump a single cent for his great contribution and support for Chinese companies and manufacturers to grow and prosper outside America and Europe. The customers in the Global South are like captured buyers and users, all because of Trump's great tariff and trade wars. Nice, very nice.
Thank you Donald. You are Godsend to make China great in double quick time.
The trade war against China realistically exposed all the vulnerabilities of the USA. And China is indeed the biggest beneficiary of USA's trade war beginning in 2018.
ReplyDeleteIt started with China's retaliation against USA farmers, by migrating Chinese soya bean and corn imports towards Brazil, Argentina and Russia. It also mitigated China's exposure to any National Security issues in food imports through such diversification to a few countries, enabling these countries to capitalize on expanding production for the Chinese market. It was a blessing in disguise and a win-win situation for China, Brazil, Argentina and Russia that it would otherwise not have the opportunity to diversify. The effect of this has serious consequences for USA farmers, now not knowing what to grow and finding a market for what they are going to grow. They are moving forward just clutching at straws like a drowning man.
The technology war has done no better, with the first salvo against Huawei, intending to put Huawei out of business by coercing USA doggies to rip off all Huawei equipment. The result was a mess of issues regarding cost, paying for Huawei's patents and developing alternative systems. In the meantime, Huawei just put all this behind and kept running forward with new innovations, a new operating system, making new phones with its own chips and is now even in the business of making high end EVs. What did not kill Huawei has literally made it stronger and better. And it has ignited the Chinese Government to pour enormous subsidies into technology that are reaping benefits, which would otherwise not have happened.
Now, about the tariff war that was supposed to cripple China's manufacturing capacity. Over the last two years, China's trade surplus has broken records, with the trade surplus in 2025 reaching US$1.2 trillion. Does that indicate the success of those tariffs? Trump and his sycophants never look further than his nose, thinking that China relies solely on the USA for its exports. China now has the Global South market all to itself to grow its manufacturing further. The USA and Europe cannot compete against China on everything from EVs to electronics in terms of cost in the Global South. It is the reality, not a fantasy that Trump had been hoping for to break China.
There is now another show being put on the Global stage to showcase the USA taking the lead to form another alliance in rare earth minerals to counter China, with all the doggies lined up with a photoshoot to scare China. They want to make sure that the rare earth that they are producing will have a bottom price selling to each other, trying to entice the doggies to invest in projects to extract and build refining/processing facilities for rare earth. The USA tried to do that in Outer Mongolia and failed miserably.
Nothing has been talked about overcoming environmental issues yet and already very confident of going ahead. No, no, China is not going to do the refining for them for sure and risked being accused of adding environmental pollution of the earth to its name. They can do the polluting of their own country. China's air pollution has been taken care of after years of suffering demonization. China has stopped the import of waste, like plastics, for recycling. Let us just watch the show.