How China can push Trump’s buttons on trade for now and gain goodwill in the US in the long term

  • China could call Trump’s bluff by taxing the goods that the US president has selectively exempted from tariffs. However, the country must also take steps to win over Americans hit hard by global trade
PUBLISHED : Saturday, 08 December, 2018, 4:29am
UPDATED : Saturday, 08 December, 2018, 4:29am

China’s tit-for-tat trade war with the US hasn’t served the goal of establishing Chinese strength or making the US realise that it was going down an ill-advised and self-destructive path.

With China having only recently gained greater political influence, and with much of the world not particularly trusting China because there hasn’t been enough time to build goodwill, it is understandable that China does not yet have many good plans of action for dealing with scenarios like this. Additionally, there are few historical references to gain guidance from.

Also, because the trade war is starting to hurt other countries that have a symbiotic relationship with China, it is not good for Chinese political power in general.

Taking the long view, China could just let the dust settle. It’s not a really big deal if progress takes 10 to 20 years longer than expected, although it means more people will not have better lives sooner.

China takes steps to support jobs as trade war hits employment

Assuming that one did want to take action, and finds Trump's presumption of absolute power unpalatable, the practical starting point might be to look not at where Trump’s votes come from, but rather what his friends want him to protect.

Trump controls reality for his voters, so they don't matter very much. But while some companies have been protected from tariffs, others have been thrown under the bus. What leverage points exist, exist there.

China should use power symbolically: Add taxes at export to the prices of just a few parts, so that they match the 10 to 25 per cent tariff rate that Trump is trying to exempt them from.

This will demonstrate that we live in an interdependent world, in which Trump cannot take action alone.

Trump-Xi ceasefire isn’t enough to resolve their deep divisions

Meanwhile, China has to do more to maintain trust with other countries. If we look at Trump’s base, their lives have suffered and their pain is real. To a large degree, that is the fault of incompetent US governance, and halfhearted efforts like Trump’s are unlikely to help.

Why not figure out what interventions could improve those people’s lives, and take sustainable action to establish goodwill? What has China learned in improving the lives of its own people that could benefit people around the world?

Alibaba once offered to help create a million jobs in the US. If we think long term, is that not still a healthy aim? We should work together better in the future. One wrongheaded person temporarily in power should not define the relationships of nations.

Sima Yi, San Francisco