Article – Three reasons Trump tariffs aren’t China’s only problem
This article highlights many of the domestic concerns all tied to China’s slowing and even contracting economy, and how Trump’s tariff threat isn’t actually Beijing’s largest concern. The piece outlined that the largest factors for a declining economy is the large youth unemployment, reliance on exports and not enough domestic household spending, and accumulated debt from local governments. In fact, household spending only made up 29% of China’s economic activity last year. China’s economy has been growing at a near explosive rate since the 1980’s, which is what catapulted it to the global powerhouse that it is now as the world’s second largest economy. However, in recent years, all of the factors above have contributed to a very slow growth. Regarding property surplus, there are many apartments built in urban areas that are ghosted and fully vacant. And, the fact that China is failing to create internal solutions to grow their economy faster domestically, their reliance on exports which seem to be dwindling with proposed and active tariffs is leaving them out of quick options at securing quick growth amidst the decline. The economic downturn of Beijing has translated to social dissent as well, which is a huge issue as this shows the CCP losing public support. The article mentioned that there were over 900 protests between June and September of 2024 by workers and property owners. The CCP’s status and public support at stake if such activity from the public were to expand, which is why they must find ways to fix this slow growth quickly. Despite what the title says, I think all of the information about China’s economic downturn actually supports the idea that Trump’s threat of tariffs could actually be their largest concern. Without sufficient domestic policies, and so many foreign businesses not investing, any chance to prohibit such tariffs with the global hegemon through negotiations with the incoming Trump administration is likely to be at the top of their priority list strategy wise. This goes back to my previous blog post about the South China Sea aggression. I believe all of these factors are even more reason for why China would place pressure on the United States to come and negotiate on their terms, although the likelihood of this actually happening is unknown. But it is worth noting that neither Washington nor Beijing want war with each other, so negotiations are the next step regarding the maritime aggressions as well as their trading relationship.