Xi Jinping has already outmanoeuvred Donald Trump. A new tariff war will backfire disastrously

Xi Jinping
Xi Jinping has taken every opportunity to frame the US as a declining hegemony

President-elect Donald Trump has just declared his intention that, on his first day in office, he will impose 10 per cent tariffs on all US imports from China, including those already subject to such levies. This measure would only be repealed when Beijing fulfils its commitment to arrest and punish Chinese traffickers in fentanyl and other such chemicals sold in the US, for which China remains the largest source. Each year, around 100,000 US citizens die from using fentanyl and other synthetic drugs.

Trump has seen at first hand how difficult US co-operation with the Chinese regime can be. PRC law enforcement is not transparent and local legislation lags behind criminal work-arounds. But most importantly, Beijing politicises its foreign co-operation, rent-seeking in good times and turning co-operation off when relations with partners sour. Joint US-China  work on counter-narcotics ground to a halt completely in 2022 after the Biden administration declined to remove Trump-instigated tariffs as a reward for China’s commitment to the task.

Work began again after deft US diplomacy in November last year, following Biden’s meeting with Xi Jinping in San Francisco. But it has not gone well enough. Again Beijing has failed to prosecute, punish and disrupt local criminal networks whose products, often smuggled into the US via connected gangs in Mexico, continue to take such a brutal toll on life, health and public safety across the US.

The reasons for this are complex; ultimately, the Chinese Communist Party uses laws to promote its own interests, and has never willingly ceded control or provided open access to any external authority. Their handling of the origins and early spread of Covid-19 is the clearest instance of this.

Be this as it may, the next president of the US has once again threatened to use economic leverage to address, or at least to punish, damage to US interests attributable to the Chinese regime. True, 10 per cent is less than the 60 or even 100 per cent which Trump has spoken of imposing recently. But what would be the effect if this threat were carried out from January next year? Beijing is unlikely to be the big loser that Trump may imagine.

The world is a very different place today from that in which Trump launched his trade war with China early in 2018. The chaos and mistrust spread across the globe by the Covid pandemic changed international relations forever. China has moved fast forward into explicit competition with the West, and this competition is well on the way towards becoming a conflict as Beijing supports Vladimir Putin in Ukraine and piles military coercion onto Taiwan.

To de-risk Western sanctions and tariffs, Xi Jinping has aggressively mobilised China’s controlling relationships across the Global South and beyond, securing its supply lines for critical materials and building dependencies on Chinese technology. Before and since the US elections, Xi has taken every opportunity – including recent meetings of the BRICS-plus, APEC and the G20 – to frame the US as a declining hegemony which China has the right to replace as the just custodian and patron of free, fairer growth in the developing world.

However far this rosy picture diverges from the facts, the dollar signs are there to prove the global reach of Beijing’s combined economic, political and increasing military influence. By comparison, in the absence of robust geostrategic engagement, the US seems on the back foot – even in Latin America, its former “backyard”.

This dire situation is not going to be made better by more tactical tariff wars with Beijing without a wider objective.

Trump will end up “Making America Weak” if he continues down the road of narrow isolationism, which is just what Xi and Putin want. Confronted by the Russia/China nexus, the only possible response is to revive security, political and economic ties with friends in the rest of the democratic and developing world, and together drive back the forces of lawless entropy while there is still time.