Xi Jinping wants you to know that he will not be turned into a cow.
Unless Beijing reverses its retaliatory tax on US imports, China’s top leaders face the latest threat from President Trump on an additional 50% tariff on Chinese goods. His Commerce Department on Tuesday denounced the US as a “terrifying mail” and declared that Beijing would “fight until the end.”
But behind Bravado is a more complicated set of reality for XI, making it politically and economically unacceptable to provide concessions to the main rivals of global influence, the country’s single largest trading partner. A catastrophic trade war between the two biggest economies could be inevitable as Trump refuses to retreat. This is a showdown with painful consequences that can be felt all over the world.
XI’s dilemma is that while appearing weak is not an option, hitting a counterattack is a further escalation. Chinese leaders cast themselves as national saviors rejuvenating their country’s greatness. As a result, Beijing is less flexible to retreat from the fight against Washington, as other US trading partners such as Vietnam have tried, analysts said.
“Beijing’s past reactions highlight three things: resolve, resilience and retaliation,” said Julian Gewartz, former senior Chinese policy officer at the White House and the State Department under President Biden, who is currently writing a book on US-China relations.
“Xi has built an image of himself as a rebellious strongman leading a powerful nation, and China’s official message conveys that they are determined to endure us even at high costs,” he said.
This helps explain why China gave up a deal last week to sell a portion of Tiktok to American investors in response to Trump’s sweeping tariffs, and why it resists selling a port owned by Hong Kong company CK Hutchison along the Panama Canal.
It also arises as to why Beijing threatened more measures on Tuesday when Trump imposed an additional 50% on Chinese goods. China said it was willing to hold talks with ease, but was not under obsessiveness.
China’s leaders are also likely to calculate that clashes with the Trump administration are inevitable, analysts say. Last week’s Trump tariffs could be seen as evidence that countries that targeted countries like Vietnam and Thailand, where Chinese companies set up factories to skirt previous US tariffs, are also determined to stop Washington from the rise of China.
“We’re excited to be able to help you get the chance to get a better sense of service,” said Ryan Huss, director of the John L. Thornton China Center at the Brookings facility. “At best, they believe it will only postpone America’s resolve to destroy the Chinese economy.”
With rising tensions, meetings between XI and Trump are increasingly unlikely.
Trump, who sees unpredictability as his signature weapon, says he is open to engaging with XI, even suggesting that Chinese leaders will visit. However, Chinese officials are reluctant to schedule meetings until both parties negotiate details in advance.
Even if XI submits and submits to Trump’s demands to cancel China’s retaliation fees, it is unclear what the trade contract will bring meaningful dents to the imbalance of yoning trade between the two countries. Last year, the US imported $440 billion worth of Chinese products. This imported more than three times the value of the $144 billion US goods imported by China.
Yunsang, China program director at Stimson Center in Washington, believes Beijing is focusing on undermining China’s control of exports in order to bring manufacturing back to the US.
“Decoupling may be an endgame,” San explains how China is likely to interpret Trump’s motivations.
XI has long warned that China’s rise is likely not to be challenged by the West, and that he has invested heavily in efforts to build China’s independence.
As stock markets around the world fell this week, Beijing has mobilized state-owned banks and investment companies, known informally as the “national team” in China, holding Chinese stocks to stem the decline. Chinese stocks rose slightly on Tuesday after a significant drop a day ago.
And the Communist Party’s mouthpiece, People’s Everyday, released an commentary on Sunday urging Chinese citizens to be confident in their ability to survive tariffs. The work argued that China has expanded its trade market outside the US and with the help of breakthroughs in technologies such as artificial intelligence, the Chinese economy is growing more self-sufficient.
Economists say these points are true, but say a full-scale trade war on a scale threatened by Trump still brings considerable pain to China. If the Trump administration imposes an additional 50% tariff, the US collection can be 104% on Chinese products. However, for some products, fees could be much higher due to tariffs that date back to Trump’s first term.
Chinese exporters may not simply be able to divert their goods to other countries as China’s export floods are already concerned in major markets like the European Union.
At the same time, in this tariff blinkmanship game, Chinese analysts believe Trump is likely to succumb to domestic pressures to change tacks due to rising US goods and a surge in stock prices.
“If it’s the question of who can withstand more pain, China will not lose,” said Wang Wen, dean of the Institute of Financial Studies at Len Min University in Beijing.
The US needed China, Wen said China needed the US because its factories made parts and components that could not be found anywhere else in the world.
“Other countries buy goods from China and then sell them to the US,” he said.
Part of China’s strategy has also been to use the chaotic results of Trump’s tariffs to try to separate the rest of the world from Washington’s trajectory.
XI will be visiting Southeast Asian countries, including Vietnam next week. Beijing has also tried to project Japan, South Korea and the United Front against Trump’s tariffs, but Tokyo and Seoul officials, both relying on the US for security, are keeping their distance from China’s position.
On the same day Trump announced his tariffs, China’s Foreign Ministry posted a video on social media casting the United States as a source of harm and instability following references to the US president expelling migrants and promoting tariffs imposed on newly delivered vehicles at ports. “Want to live in a world like this?” the narrator asks.
It was followed by a scene of a Chinese rescue team pulling Chinese peacekeepers and Chinese rescue teams out of the tile rub following the recent earthquake in Myanmar, placed on a soundtrack featuring John Lennon’s “imagination.”
“We are accused of the Asian Association Policy Research Institute in Washington,” said Danny Russell, diplomacy and security analyst at the Asian Association Policy Research Institute in Washington. The Foreign Ministry video is “pure propaganda jiu-jitsu,” which aims to help China provide order and partnership while portraying Trump’s tariffs as a reckless US turmoil.
“But the views from Beijing are at odds,” Russell said. “Beijing’s instinct is to avoid interrupting the enemy when he’s making mistakes, but they are also deeply concerned that those mistakes could potentially crash the world economy and China with it.”
