When Donald Trump first started a trade war with China in 2018, Beijing found itself on the back foot and unsure of how to respond. This time Xi Jinping is better prepared for a fight, even as he has more to lose.
Trump, who won a second term as president in an election on Tuesday, has threatened to put tariffs of as much as 60% on Chinese goods, a level that Bloomberg Economics says will decimate trade between the world’s biggest economies. That’s on top of a range of export controls on advanced technology that the Biden administration has only tightened since Trump left office.
In that time, China has taken strategic steps to ensure it’s more resilient and well positioned to strike back. Key to that has been expanding its toolkit, which now includes export controls on critical raw materials, in addition to tariffs on agricultural goods and an entity list that can target key American companies.
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