Promoting and defending free trade is the key in China-US ties

Yesterday incoming US President Donald Trump announced on social media that he would be slapping tariffs on numerous countries on Day One in office, including 25 percent on Mexico and Canada, as well as 10 percent on China, which he stated would be in addition to any future tariffs.

It is quite obvious that the White House will return to its strategy of weaponizing levies against Beijing to try and force China to make concessions by hurting its trade and supply chains.

Concerning for Mexico and Canada, given their geographical and economic dependency on exports to the United States, we should expect the president to use this as quick leverage in order to force them to capitulate to American terms and conditions, as they did before with the North America Free Trade Agreement (NAFTA).

While Trump has publicly stated immigration and drugs are part of the spat with Mexico, we should absolutely expect "anti-China strings" attached to any new agreement they have made, especially concerning Chinese investments in the electric vehicle supply chain there. Mexico's president did, however, threaten their own retaliatory tariffs in such an instance.

On the other hand, we should anticipate that Canada will just do whatever the US wants, as they have been anyway. Canada has effectively been robbed all leverage and independence in its foreign policy making by being in the extraordinary position of having burnt its bridges with both China and India simultaneously, placing itself in a corner with the United States as its only option.

Out of all the Anglosphere states, Ottawa has no engagement with Beijing whatsoever. This leaves them completely at Trump's mercy in the event of any trade conflict, and chances of directly re-engaging with China in the midst of it all to balance things out seem remarkably slim.

As for China itself, Trump will again play extreme hard ball. There will be tariffs, more tariffs, and the negotiation barriers to removing those tariffs will be very high. To his credit, at least he is willing to talk, the Biden administration was not. Trump is looking for a political "win," he wants to be able to open up the Chinese market for American exports and claim that he is a defender of jobs and manufacturing at home. If China is sensible about this, despite the ultra-hawks he has placed in his administration, they should see this as an opportunity as much as it is a challenge.

However, that also does not mean total capitulation. China should of course acquire its own leverage and be able to strategically outplay the Trump administration while seeking to avoid direct confrontation with him. The key is not only what is done with the US directly, but also other countries. After all, anxiety about Trump and American protectionism is not just a sentiment felt by China, it is one felt by the whole world as well including allied states. Under Trump, the United States becomes more unpredictable, more unstable and likewise America's liberal centric media start to demonize and exaggerate every single thing the administration does which overtly hurts America's soft power. This, as it did in 2017-2021, creates an opening for Chinese diplomacy.

While the United States pushes tariffs and trade wars, Beijing again has the opportunity to frame itself as the defender and advocate of the multilateral trading system and globalization. Therefore, China should commit its diplomatic energy to isolating the United States by doubling down on as many free trade and economic agreements as possible, thus pushing back at an American-led agenda for decoupling. This is a diplomatically and economically beneficial strategy which is also necessary to mitigate against what will likely be a brazen agenda by the new administration to establish a new Cold War and thus forcibly divide the world into "blocs."

Chief on China's agenda should be to push forward to join the CPTPP agreement as fast as possible. There is a window of opportunity to do this, with amicable governments now in place in Tokyo, London and Canberra, and likewise if Ottawa has any sense it should not stand in the way in order to get out of the pit its foreign policy has placed it into, and it can hide behind "following" the rest.

Out of all them, establishing a solid détente in relations with Japan should be the priority, with the LDP having been domestically weakened losing its majority and its new leader unsure of Trump. The current Labor governments in Australia and Britain are also committed to engaging with China, but if their Conservative counterparts return to office they will pursue solid alignment with Washington again. Thus, this window of opportunity has to be seized upon very quickly.

The solution to dealing with Trump is not confrontation, but free trade and lots of it. China must shore up its options and contingencies, then it should seek to make a deal with him, marginalize the ultra-hawks and stabilize US-China relations as a whole!

(The author, a postgraduate student of Chinese studies at Oxford University, is an English analyst on international relations. The views are his own.)