President Xi woos China’s neighbours stunned by Trump tariffs


President Xi Jinping's Southeast Asia tour aims to capitalize on the global trade uncertainty caused by US tariffs, offering closer partnerships to nations impacted by Trump's policies.
AI Summary available — skim the key points instantly. Show AI Generated Summary
Show AI Generated Summary

On Monday China’s President Xi will seek to take advantage of the confusion America has poured onto the global trading system by offering closer partnership with the emerging nations of southeast Asia.

He is beginning a week-long tour of the region in Vietnam, a country that has moved more closely into the American orbit in recent years but was nevertheless hit with 46 per cent tariffs by President Trump last month.

Trump has since put those tariffs on hold for 90 days, but left additional 10 per cent tariffs in place and suggested that countries such as Vietnam need to offer Washington concessions to prevent the full amount being reimposed in July.

President Xi

MATEUS BONOMI/ANADOLU /GETTY IMAGES

Xi, who will travel to Malaysia and Cambodia later in the week, also spoke over the weekend to President Subianto of Indonesia, saying the two countries had “stood together through thick and thin” over the years.

China has historically complex relations with many of its neighbours, both notionally communist states such as Vietnam, which was supported by the former Soviet Union when it was at loggerheads with China, and those that won support from the US, including Indonesia.However, since the end of the Cold War, trade has begun to play a central role, even if there are still disputes about borders and control over the South China Sea.• Why China is not afraid of a trade war with TrumpChina overtook the United States as the largest trading partner of the Association of Southeast Asian Nations (Asean) in 2009. However, several countries have attempted to move towards the United States since then out of fear that they would become too dependent on China. Vietnam in particular has become an alternative manufacturing hub for American companies, including Apple, while Cambodia has become a big exporter of textiles, including to the United States. Exports to the US from Cambodia have more than quadrupled since 2016.President TrumpSAUL LOEB/AFP/GETTY IMAGESHowever, to Trump this means these countries have merely joined the ranks of those determined to “rip off” the US. Cambodia was hit with a “Trump tariff” of 49 per cent, one of the world’s highest, despite being the third poorest country in Asean.Thailand, Indonesia and Malaysia were given tariffs of more than 20 per cent, before they were suspended.China was originally hit with 54 per cent additional tariffs, including those Trump had already announced, but they were increased to 145 per cent in a tit-for-tat escalation. However, late on Friday Trump suspended tariffs on Chinese-made phones, laptops and other electrical imports.China is worried about the effects of the new trade war Trump is apparently determined to pursue on its economic model, which is led by manufacturing and exports. However, it believes that with direct exports to the US declining compared with those to other countries it can survive the pain, while also gaining politically by standing as a defender of “global south” trading nations.In another blast at Washington on Sunday, the commerce ministry called for Trump to follow the suspension of tariffs on electrical goods by abandoning the whole policy.A spokesman said the tariffs policy had “not only failed to resolve any issues for the US but has also severely disrupted the international trade order, significantly interfering with normal business operations and people’s consumption, ultimately harming others without benefiting itself”.On his tour, Xi is likely to try to reassure China’s neighbours that they will not be swamped with cheap exports redirected from the American market. He will almost certainly arrive with sweeteners — Vietnam is seeking Chinese loans to help fund a trans-Vietnam railway that will link with China’s own network on the border.

Was this article displayed correctly? Not happy with what you see?

Tabs Reminder: Tabs piling up in your browser? Set a reminder for them, close them and get notified at the right time.

Try our Chrome extension today!


Share this article with your
friends and colleagues.
Earn points from views and
referrals who sign up.
Learn more

Facebook

Save articles to reading lists
and access them on any device


Share this article with your
friends and colleagues.
Earn points from views and
referrals who sign up.
Learn more

Facebook

Save articles to reading lists
and access them on any device