Is China a manufacturing power? Can the tariff change it?

US President Donald Trump struck China as the second tariff in a few months. This means income from there. Now face to impose at least 20%.

This is his latest Salvo for Beijing. Beijing is already facing US tariffs, from 100%of Chinese electric vehicles to 15%of clothes and shoes.

Trump’s tariffs manufacture and deliver almost everything from the center of China’s Juggernaut to strike -factory, assembly lines and supply chains, fast fashion and toys to solar panels and electric vehicles.

China’s trade surplus with the world rose to 1TN (£ 78 billion) on the back of a strong export ($ 3.5TN) in 2024, surpassing the import bill (2.5TN).

China has long been a world factory. Since the opening of the economy in the late 1970s, it has flourished due to low labor and state investments in infrastructure.

How severe Trump’s trade war could harm China’s success?

Targets are taxes for products imported from other countries.

Most tariffs are set at the percentage of the value of the product and are generally importer.

Therefore, 10% tariffs mean that a $ 4 worth of products imported from China will face an additional $ 0.40 claim.

Increasing the price of imported products helps consumers to promote their economic growth by encouraging consumers to buy cheaper domestic products.

Trump sees them as a way to grow the US economy, protect jobs, and increase tax revenues. But economic research on the impact of tariffs imposed during the first term in the office suggests measures. Ultimately US consumer prices rise.

Trump says his most recent tariff is to put more effort on China to prevent opioid Pentanil’s flow to the United States.

He also imposed a 25%tariff on neighboring Mexico and Canada in the United States, and leaders said they were not enough to crack down on illegal drug transactions.

Yes, analysts say.

Exports were the “savings grace” of the Chinese economy, and if taxes remain, exports to the United States could fall to one -third, according to Harry Murphy Cruise, an economist at Moody ‘S Analytics.

The pure value of China exports, which accounts for one -fifth of the national income, means that 20%of tariffs can weaken overseas demand and reduce trade surplus.

Alicia Garcia-Herrero, the chief economist at the Asia-Pacific, Hong Kong, said, “The tariff will harm China. “They must actually do much more work. They must do what Xi Jinping has already said. We must increase domestic demand.”

It is a big thing in the economy The real estate market is increasing rapidly and Young people of disillusionment are struggling to find high -paying jobs..

The Chinese did not spend enough to recharge the economy. Beijing Many stimuli measures have been announced To increase consumption.

The tariff can slow China, but it cannot be easily stopped or replaced, the analysts say.

Garcia-Herrero said, “China is not only a big export country, but sometimes the only exporter of the solar panel. If you want a solar panel, you can only go to China.

China has begun to pivot from making clothes and shoes long before Trump became president, to advanced technologies such as robotics and artificial intelligence (AI). And in the second largest economy in the world, it gave China the advantage of “initial mobilization”.

Shuang Ding, a Chinese economist at Standard Chartered, said the Chinese plant can produce high -quality technology at a low cost.

“It’s really hard to find a substitute … China’s status as a market leader is very difficult to go over.”

There is China Respond to the counter tariff 10-15%of US agriculture, coal, liquefied natural gas, pickup trucks and some sports cars.

In addition, export restrictions have been targeted for US companies in the aviation, defense and technology fields, and have published an anti -monopoly survey on Google.

China also spent years in tariffs in Trump’s first term. For example, some Chinese manufacturers moved the factory out of the country. And the supply chain was more dependent on Vietnam and Mexico by exporting to bypass tariffs.

Nevertheless, Trump’s recent tariffs on Mexico will not harm China too much because Vietnam is a larger backdoor of Chinese goods, Garcia-Herrero.

“Vietnam is the core here. I think it will be very difficult if tariffs are imposed in Vietnam,” she said.

Analysts say China is more interested than tariffs, US restrictions on high -end chips.

This limit was a major stubborn point between the two countries, but it promoted China’s decision to invest in its own technology irrelevant to the West.

That’s why Chinese AI company DEEPSEEK was shocked Silicon Valley and Washington have released a chatbot competing with Openai’s CHATGPT. The company is known to have reserved NVIDIA chips before blocking China’s approach to the most advanced people.

Ding of the standard charter said, “I don’t think it will affect China’s manufacturing power, but it can affect China’s competitiveness.”

On the other hand, China’s ground in the field of high -tech manufacturing will increase expensive exports.

The analysts said they were caused by national support, unmatched supply chain and inexpensive labor.

Chim Lee, an analyst at the Economist Intelligence Department, said, “The combination of globalization and China’s private business policy and market potential helped to attract the initial waves of foreign investors.

The government has doubled and has invested a lot to build roads and port networks to bring raw materials and bring Chinese products to the world. It was also a stable exchange rate between China’s comfort and US dollar.

Analysts say that competitors will continue to be involved in recent years with the transition to Advanced Tech.

China has already had a lot of economic influence as a manufacturing powerhouse. But as Trump’s tariffs improve their relationship with the United States, there are also political opportunities.

Moody’s’ S’s Cruise said, “The door is Ajar that China can become an advocate of free trade and stable global forces.

However, it is not easy considering that Beijing was accused of violating international trade norms. 200% or more tariffs Australian wine income in 2020.

Analysts say that China should go beyond the United States, which is still the best destination for exports. China is the third largest market in US exports since Canada and Mexico.

China’s trade with Europe, Southeast Asia and Latin America is growing, but it is difficult to imagine that the world’s two largest economies can stop relying on each other.