Trump's Trade War Has Rattled Geopolitical Stability In Asia

President Donald Trump started April off by reigniting global trade tensions with his “Liberation Day” tariff announcement, targeting nearly all the country’s major trading partners. China, singled out for particular pressure, faced an additional 34% tariff. The decision undoubtedly irritated the Oriental giant as it vowed to “fight to the end.” The two superpowers ratcheted up duties against each other as April wore on. Currently, most imports from China are subject to an 145% duty in the United States. This article evaluates how the latest tariff hike reshapes international security, employing a geopolitical and historical lens.

While the “Liberation Day” tariffs may seem an indiscriminate attack, President Trump’s subsequent actions could reveal his true intent: using tariffs to reduce China’s stranglehold over international trade in goods. One week after “Liberation Day”, the White House announced a 90-day pause on all reciprocal tariffs except for China. This decision could draw allies to the negotiating table and make concessions by increasing trade barriers against the Beijing regime. For instance, Vietnam has promised to crack down on Chinese exporters’ transhipment fraud and vowed to tighten the control of sensitive exports after being threatened with a 46% levy from the US. Hence, one could interpret President Trump’s latest tariff threat as a radical move attempting to box out China in the international economy.

China has responded by engaging in “charming diplomacy”. President Xi Jinping visited Vietnam and Malaysia soon after Trump’s tariff announcement. During the state visit, Xi emphasised the long friendship and collaboration between these countries and China and urged the duo to resist “unilateral bullying”, encouraging them to stand with China in this trade war. Noticing that these developing countries rely heavily on Chinese investment in infrastructure while being American traditional partners in the military and economic sector, the trade dispute between China and the US has pushed the duo into quite the quandary. China may well take this opportunity to drive a wedge between these Southeast Asian countries and the US, thereby breaking through the first island chain set by the US to contain China’s influence in the Indo-Pacific region. This could unlock Southeast Asia more broadly as a site of US-China contestation.

This trade isolation is already aggravating China’s post-Covid hardship, which may prompt the country to shift its focus into military development. China has faced a mounting manufacturing surplus in the post-pandemic era. Although the state has long reassured the public that its massive domestic market could replace foreign exports in digesting the surplus, research tends to be pessimistic as China’s total consumption is simply incomparable with that of the US. Hence, the loss of the American market due to the trade war would indubitably lead to excess production capacity and rising unemployment in China. Yet, history teaches that non-democratic regimes have a habit of supercharging military production to cope with economic hardship. For instance, Nazi Germany reactivated its military-industrial complex after the Great Depression, successfully absorbing much of its unemployed population. Unfortunately, China seems set to follow this example as its army plans to recruit more officers from college students to alleviate the rising unemployment rate, which could pose further uncertainty to international security.

In addition, the trade war could risk the Chinese Communist Party losing its ruling legitimacy, insofar as it is derived from China’s economic miracle, which could escalate geopolitical tensions. Since the Reforms and Opening Up, many Chinese seem willing to sacrifice some of their liberty in exchange for lasting economic growth. Yet, the trade war with the US could crush this invisible social contract. The regime, therefore, attempts to shift the public's dissatisfaction by manipulating the nationalist sentiment across the country, exemplified by its latest military drills in the Taiwanese Strait and its hostile rhetoric towards Taiwan and the US. Apart from that, China relies on American imports for many of its strategic industries, especially the agricultural and high-tech sectors, a vulnerability which could drive it towards more desperate actions, thereby further intensifying tensions in East Asia. If China fails to secure adequate substitutes of similar quality from its allies, it may take a political gamble and resort to aggressive actions to protect its interests. This behaviour too has precedents, e.g. militarist Japan's aggression towards China and the US in its pursuit of natural resources. 

This risk of aggression is made all the more unnerving by what China sees as favourable

international conditions, exemplified by the internal political struggles in Taiwan and South Korea. Taiwan has witnessed mass recall campaigns between the ruling party and the largest opposition party, aiming to unclog the political deadlock following the 2024 presidential election. This paralysing division could give China a golden opportunity to influence public opinion on the island regarding the cross-strait issue. As for South Korea, the impeachment of former President Yoon Suk Yeol leaves Cheong Wa Dae's door wide open for the pro-China opposition leader, Lee Jae-myung, who suggests the country should not "bother meddling everywhere", especially regarding the Taiwan Strait issue. Hence, Lee's presidency would probably shake America's containment strategy against China.

To conclude, President Trump's tariff bombs not only hit the global economy but could reshape geopolitics and international security. His radical moves are pushing the world into uncharted waters riddled with escalation risks and economic woes.

Image: Wikimedia Commons/Trump White House (Shealah Craighead)

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