China's actions are a sign Trump’s tariffs are working, Gordon Chang, an expert on China and frequent critic of its communist party, said on Washington Watch Tuesday.
In a repeat of Trump's first term, the U.S. and China remain embroiled in a trade war kicked off by Trump’s imposition of tariffs against most U.S. trading partners, including the authoritarian nation that is also the world’s leading exporter.
China has responded with its own tariffs on U.S. products shipped to its shores.
Then Trump’s tactics shifted. The President on April 10 placed a bullseye on China, pausing all other tariffs for 90 days while keeping a tariff rate of 145% on Chinese goods.
China has responded to Trump’s attempts to isolate it with threats against countries who are currently negotiating trade relationships with the U.S. And that list is long.
The office of the Chinese Ministry of Commerce on Monday announced, “China firmly opposes any party reaching a deal at the expense of China’s interests. If this happens, China will not accept it and will resolutely take reciprocal countermeasures.”
The statement presented China as a peace-loving business partner ready to “defend international fairness and justice,” while accusing the U.S. of issuing “abusing tariffs” and “unilateral bullying.”
The reality, however, is that China is known for being ruthless and underhanded. So countries that do business with China can get a businessman's hand shake or a Communist fist to the face.
“I think it is saber rattling," Chang told show host Tony Perkins. "And I think it is an indication that the Chinese are very worried that President Trump will reorder the global trading system because we've got the world's largest market."
Chang predicted the CCP is worried it will be "left out in the cold."
China has been the world’s No. 1 exporter since 2009.
In 2023, its exported goods were valued at roughly $3.38 trillion, according to the United Nations’ COMTRADE database.
Consumers value a number of Chinese products ranging from electrical machinery and equipment, computers, optical readers, integrated circuits and more.
But there’s also great attraction in doing business with the U.S., which offers the world’s largest base of potential customers, Chang told show host Tony Perkins.
“I think China’s getting a little bit worried right now," Chang, who has long predicted the downfall of the CCP, observed.
More than a dozen nations are known to be negotiating trade deals with the U.S. right now, China being one.
But those who could strike deals that would potentially anger the Chinese include Canada, Mexico, Japan, South Korea, India, Brazil, Australia and more.
The European Union is also involved in talks, particularly on matters related to steel and aluminum.
China’s weakened position
China has a weak negotiating position with other nations because it’s a trade-surplus country, Chang said.
That’s still true, though that surplus has lessened during the trade war.
China had a trade surplus of $02.64 billion for March, down from $170.52 billion for February, according to TradingEconomics.com.
The U.S. is a trade-deficit country – something Trump is trying to change – which makes it more appealing for nations to deal with the U.S. The surplus-deficit scenario has the potential to create jobs, economic stability and currency appreciation for the surplus nation.
China, as a trade-surplus nation trying to maintain and increase foreign investment, is in a tough spot, Chang said.
“They can do minor things, but ultimately a trade surplus country is very...just out of ammunition.”
China earlier this month announced restrictions on exports of seven rare earth elements including dysprosium, terbium, lutetium, and rare earth magnets, which are essential for manufacturing high-performance magnets used in electric vehicles, advanced weaponry and electronics.
It’s not going well, Chang said.
“China tried that in 2010 against Japan and the embargo collapsed in a couple of months. The Japanese found ways around it. We're doing the same things. Even Boeing, that's a really hollow threat just because of the way the global airplane market works.
“You have backlogs of years and years and years,” he continued. “There's only so much production in the world. Whatever China doesn't buy from Boeing, Boeing will be able to sell to Airbus customers who are not going to wait for 10 years to get an Airbus because Airbus sells to China.”
China, which exports far more than it imports as its surplus shows, could ultimately hurt its customer base, Chang said, as other countries consider expanding their own manufacturing production.
India gets in the tariff game
India is a prime example. This week it imposed a 12% temporary tariff on steel imports, primarily from China, to curb a surge in cheap shipments that have affected the steel industry in India, potentially leading to job cuts.
How the move plays out in India’s trade relationship with the U.S. remains to be seen.
“That was really to prevent China from selling to India what it couldn't sell to the United States, and I think we're going to see this around the world as countries protect their local markets from what they anticipate to be a flood of Chinese goods,” Chang said.
U.S. Vice President J.D. Vance is visiting India this week.
Speaking at a public event, Vance highlighted the importance of deepening US-India ties to ensure a prosperous and peaceful 21st century.
"I really believe that the future of the 21st century is going to be determined by the strength of the United States-India partnership," he said.
