US President Donald Trump’s new tariffs against China will not inflict significant short-term pain on the country’s exporters, but the action is a blow to Beijing’s ambitions for leadership of the global economy’s commanding heights.
The White House has not yet specified which products will be affected, but US trade representative Robert Lighthizer said that his office would target sectors included in Beijing’s “Made in China 2025” plan. This industrial policy initiative aims to promote Chinese ascendancy in strategic sectors such as advanced IT products, robotics, aerospace, and electric vehicles.
Analysts say that focusing on these sectors alone will make it difficult for the US to reach its goal of imposing tariffs on $60bn worth of Chinese exports — one-eighth of the country’s total exports to the US last year. Similarly, the latest action will do little to advance the administration’s previously stated goal of reducing the bilateral deficit by $100bn.
“These are sectors where China aspires to global leadership and an increasing share of exports, but they’re not where their exports are currently concentrated,” said Louis Kuijs, head of Asia economics at Oxford Economics in Hong Kong.
US tariffs target China industrial policy, not trade deficit
The White House has not yet specified which products will be affected, but US trade representative Robert Lighthizer said that his office would target sectors included in Beijing’s “Made in China 2025” plan. This industrial policy initiative aims to promote Chinese ascendancy in strategic sectors such as advanced IT products, robotics, aerospace, and electric vehicles.
Analysts say that focusing on these sectors alone will make it difficult for the US to reach its goal of imposing tariffs on $60bn worth of Chinese exports — one-eighth of the country’s total exports to the US last year. Similarly, the latest action will do little to advance the administration’s previously stated goal of reducing the bilateral deficit by $100bn.
“These are sectors where China aspires to global leadership and an increasing share of exports, but they’re not where their exports are currently concentrated,” said Louis Kuijs, head of Asia economics at Oxford Economics in Hong Kong.
US tariffs target China industrial policy, not trade deficit