Trump’s Strategy for China-U.S. Competition in the Second Term by WANG Dong and MA Tao

After Trump takes office, China-U.S. relations will face more challenges, and China needs to respond appropriately.

Welcome to the 23rd edition of our weekly newsletter! ChinAffairs+ is a weekly newsletter that shares Chinese academic articles focused on topics such as China’s foreign policy, China-U.S. relations, China-European relations, and more. This newsletter was co-founded by me and my research assistant, ZHANG Xueyu. I am SUN Chenghao, a fellow with the Center for International Security and Strategy (CISS) at Tsinghua University, Council Member of The Chinese Association of American Studies and a visiting scholar at the Paul Tsai China Center of Yale Law School (fall semester 2024).

Recently, I published an article together with Siyao Chen, analyzing several Chinese perceptions, and examined the scenarios China envisages for TikTok’s future in the US. Read more on the Brookings Institution website: https://www.brookings.edu/articles/what-does-the-tiktok-saga-reveal-about-china-us-relations/

In addtion, I am thrilled to have been selected as a participant in this year's Munich Security Conference Young Leaders program. I still remember my experience attending the conference last year, and this time I will be returning with a new identity to continue experiencing the dynamics of Europe up close. I am looking forward to the opportunity to engage with friends from around the world in Munich soon.

Today, we have selected an article written by WANG Dong and MA Tao, which focuses on Trump's Strategy for U.S.-China Competition in His Second Term.

Through carefully selected Chinese academic articles, we aim to provide you with key insights into the issues that China’s academic and strategic communities are focused on. We will highlight why each article matters and the most important takeaways. Questions or criticisms may be addressed to sunchenghao@tsinghua.edu.cn

Edited by ChinAffairs+.

Summary

Trump’s second-term competitive strategy, centered around “Trump 2.0”, focuses on using tariffs to “rebalance” China-US trade relations, pushing for the cancellation of China’s most-favored-nation status, and engaging in all-encompassing security competition with China. This strategy calls for cooperation between China and the US on issues like combating drug crimes, while also confronting China on matters related to its core interests, raising the level of China-US geopolitical competition.

Trumpism, rooted in the outsourcing of American manufacturing, working-class struggles, white identity anxiety, and worsening trade deficits, advocates against globalization, free trade, and immigration, emphasizing the revival of the American spirit, which has profoundly reshaped US domestic politics and foreign policy. As a result, “Trump 2.0” elevates China-US competition to a new height, with the escalating tariff war and geopolitical conflicts potentially weakening the stability of the international order and increasing the risk of geopolitical confrontation. Furthermore, pan-security issues will affect China-US cultural exchanges.

China should adhere to the strategic principle of “abandoning illusions, preparing for the worst, striving for the best, and not fearing the worst”, actively respond to the challenges of “Trump 2.0”, secure strategic initiative, and plan and lead the shaping of sustainable China-US bilateral relations in the new era as a responsible major power.

Why It Matters

The analysis of former U.S. President Donald Trump’s second-term strategy toward China is crucial, given its potential impact on global geopolitics and economic dynamics. Trump’s first term laid the groundwork for intense U.S.-China competition, particularly in trade, technology, and military influence. His policies, including the trade war, tariffs, and efforts to decouple the two economies, shifted the U.S. perception of China to a strategic rival.

Scholars are eager to assess how Trump’s second term may unfold, considering his “America First” approach, which prioritizes U.S. interests, even at the cost of international alliances and global trade structures. This could escalate tensions, particularly over issues like Taiwan, the South China Sea, and global supply chains. While many analyses of Trump’s second term exist, this article offers a more comprehensive perspective by exploring the roots of Trumpism, rooted in America’s historical and societal challenges. Additionally, the question of “who could be the next Trump” has garnered attention in China.

Key Points

1. Background to Trump’s Second-Term China Competition Strategy

Trump’s second-term strategy towards China is shaped by his broader “America First” agenda, focusing on national interests and an existential crisis he perceives for America. Key elements of his approach stem from long-standing issues in U.S. domestic politics and international relations.

• Social Division and Economic Restructuring

The decline of U.S. manufacturing and the rise of high-tech industries since the 1970s have deepened class divisions. The “Rust Belt” has suffered, while coastal elites have thrived, exacerbating economic inequality and disillusionment, particularly among younger Americans who feel disconnected from the “American Dream”.

• Cultural Challenges and Identity Politics

Since the 1960s, progressive elites have promoted identity politics, which has led to cultural tension. Many white working-class Americans, feeling alienated by globalization and sidelined by elites, supported the Tea Party and Trump’s MAGA movement in response to these shifts.

• Economic Globalization and Trade Deficits

Globalization has led to the outsourcing of manufacturing and increased U.S. trade deficits, which became more pronounced after the pandemic and the Ukraine crisis. As a result, supply chain and manufacturing security became national security priorities, motivating Trump’s trade war with China.

• Unsustainable Hegemonic Costs

U.S. hegemony after the Cold War came at significant costs, with military and diplomatic efforts, including wars in the Middle East, draining resources. Trump criticized these policies, arguing that the U.S. spent too much on defending others and neglected domestic issues, advocating for shifting burdens onto allies.

• Shift from Engagement to Competition with China

U.S. political elites transitioned from a “engagement consensus” with China, aimed at integrating China into the global order, to a “competition consensus” after the 2008 financial crisis and China’s rise. Trump’s second term is likely to continue this competitive approach, focusing on national interests rather than ideological rivalry.

2. The content of Trump’s second term China competition strategy

• Trade Policy: Addressing the Trade Deficit with China

Trump’s trade policy remains focused on reducing the U.S. trade deficit with China, primarily through tariffs. He has consistently criticized China for unfair trade practices, including intellectual property theft and forced technology transfers. In his 2024 campaign, Trump proposed higher tariffs and introduced the “Trump Reciprocal Trade Act” to reduce reliance on China and promote job creation. His approach, though pragmatic, is not driven by ideological rivalry but aims to maximize U.S. economic interests.

• Elimination of China’s Most-Favored-Nation Status

The U.S. has considered revoking China’s Most-Favored-Nation (MFN) status, a provision under the 1974 Trade Act, to gain leverage in trade negotiations. With Republicans controlling Congress in 2024, there is an increased likelihood of this measure passing. Trump views the MFN revocation as a tool to protect U.S. interests, pushing for stronger trade terms with China.

• Non-Traditional Security Competition: Supply Chain and Cybersecurity

Trump’s second-term strategy will prioritize non-traditional security concerns, focusing on supply chain and cybersecurity. His administration aims to reduce U.S. dependence on China for critical goods and bolster domestic manufacturing. Enhancing cybersecurity is also a top priority, as reflected in the 2018 Cybersecurity and Infrastructure Security Act, aimed at protecting U.S. infrastructure from Chinese cyber threats.

• Pressuring China on the Fentanyl Crisis

Trump has consistently targeted China over its role in fentanyl trafficking, which he views as a major societal threat. He established a presidential commission on opioid abuse in 2017 and has blamed China for supplying illicit fentanyl to the U.S. Trump is expected to leverage this issue in trade talks, potentially imposing tariffs on China and Mexico to address the crisis as part of his “America First” agenda.

• Flexible Diplomacy and Pragmatic Negotiations

Trump’s diplomacy will continue to focus on pragmatic negotiations and strategic flexibility. With fewer domestic constraints, he will use issues like Taiwan and the South China Sea as bargaining chips, prioritizing U.S. interests and trade balance over ideological confrontations. His second-term strategy will refine this approach, utilizing trade and strategic ambiguity to pressure China when necessary.

• Indo-Pacific Strategy and “America First”

Trump’s Indo-Pacific Strategy, introduced in 2017, will remain central to U.S. global dominance in his second term. The strategy emphasizes free trade, countering authoritarianism, and building stronger alliances with countries like Australia, Japan, and India. While maintaining focus on trade balance, Trump’s approach will be flexible, prioritizing practical diplomacy over ideological conflict.

• Engaging the “Global South” and BRICS

Trump will engage in strategic competition with China both regionally and globally to maintain the dominance of the U.S. dollar. He will also intensify competition in the “Global South”, acknowledging its growing role in global governance. While Trump’s strategy prioritizes U.S. interests, it may leave space for negotiation, forcing “Global South” countries to carefully navigate their alliances.

1. The impact of Trump's competitive strategy on China in the second term

• U.S.-China Trade Relations: Uncertainty but No Full Decoupling
  Despite Trump’s tariffs and efforts to remove China’s most-favored-nation status, a full decoupling or balanced trade relationship remains unlikely. Some imports from China have decreased, but others, like electronics, have increased. Trump’s protectionist policies could harm the U.S. economy, particularly in agriculture and manufacturing. Over time, such trade protectionism is unlikely to resolve structural imbalances or effectively reduce U.S. inflation, requiring a more balanced approach.

• Increased Diplomatic and Geopolitical Pressure on China
  If key strategic objectives, such as trade balance, are not met, Trump may escalate geopolitical competition with China. He could target BRICS nations challenging the U.S. dollar’s dominance, potentially hindering the BRICS payment system. Trump’s Indo-Pacific strategy will isolate China by strengthening alliances with South Asia, ASEAN, and Pacific nations, increasing geopolitical tensions and complicating China's regional cooperation efforts.

• Increased Risk of Conflict in China’s Surrounding Regions
  Trump may use Taiwan and the South China Sea as leverage in his trade competition strategy, escalating tensions. Although Trump seeks to avoid direct military conflict, he may use non-war tactics such as tariffs, geopolitical blockades, and excluding China from multilateral forums, challenging its core interests. However, Trump might not block China’s peaceful reunification of Taiwan if U.S. interests are secured.

• The U.S. “Pan-Security” Policy and Its Impact on Cultural Exchanges
  As tensions rise in trade, technology, and geopolitics, Trump 2.0 policy could extend to cultural exchanges, severely impacting U.S.-China relations. This would hinder educational, think tank, and civilian engagement between the two nations. If Trump re-enters office, the “China Initiative” might be revived, intensifying the “cold wave” in U.S.-China cultural exchanges despite ongoing tech and talent wars under Biden.

Conclusion

The U.S. “pan-security” policy significantly affects U.S.-China relations. Under the Trump administration, the “China Initiative” targeted Chinese-American scientists and scholars, placing restrictions on Chinese students and academics in the U.S., citing concerns over espionage and intellectual property theft. This initiative discouraged collaboration between U.S. and Chinese institutions and created an atmosphere of fear among Chinese scientists in the U.S.

The anti-China rhetoric and policies have, in turn, led to a talent drain in the U.S., as countries like China and others have become more attractive to top-tier scientists. As the “China Initiative” revives, the “cold wave” in U.S.-China cultural and academic exchanges deepens, further straining bilateral relations.

About the Author

Wang Dong is a full professor at the School of International Studies of Peking University, a double professor and doctoral supervisor at the Institute of Global Health Development. He is currently the Vice Minister of Social Sciences at Peking University and the Executive Director of the Sino-Foreign Cultural Exchange Research Base of Peking University, Ministry of Education. He received his LL.B. from the School of International Studies of Peking University and his Ph.D. in Political Science from the University of California, Los Angeles (UCLA).

Ma Tao, Postdoctoral, School of International Studies, Peking University.

About the Publication

The Chinese Version is about to be published in International Security Studies(《国际安全研究》), which was founded in 1983, and sponsored by the University of International Relations. It is an academic journal featuring security studies, with the purpose of "strengthening strategic thinking, reviewing international security, and safeguarding national interests". It mainly publishes first-class academic research results in the fields of international relations, national security, and international security, and enjoys a certain reputation in the Chinese academic community.

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