President Trump Launches Multifront Battle against China



President Trump

As we noted previously, China is now focusing on advanced manufacturing. However, the United States wants the country to end the subsidies under its Made in China 2025 program.

After having lost the battle for low-end manufacturing to China, the United States doesn’t want to give away one of its bastions easily.

In another move, the United States has imposed sanctions on the Chinese military for buying weapons systems from Russia. The move invited sharp reactions from China’s foreign ministry, which called for the United States to “immediately correct the mistake and rescind the so-called sanctions, otherwise the U.S. side will necessarily bear responsibility for the consequences.” To be sure, China has been flexing its muscles beyond its borders, as was best exhibited in its South China Sea strategy.

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Now, China is undertaking its Belt and Road Initiative, which is hailed as Xi Jinping’s flagship project. The initiative is China’s plan for connectivity beyond its borders. Observers expect that it will help China utilize its industrial overcapacity. China’s overcapacity has received flak from several US companies, such as U.S. Steel Corporation (X), AK Steel (AKS), and Alcoa (AA).

The United States (SPY), Japan, and Australia are trying to counter China’s BRI with their own infrastructure projects in the Indo-Pacific region. Simply put, the Trump administration is trying to take on China (FXI) across multiple fronts.

In the next article, we’ll see how China’s attempts to export its steel woes have fared.


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