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Republican presidential candidate and former president Trump | Getty Images

CNBC News in the United States quoted comments from some international relations experts on July 23 saying that if former President Trump wins a second term in the White House, he might take his trade war and economic decoupling policies to a new level.

Although the Biden administration has also put U.S.-China strategic competition at the top of its economic policy, some U.S. economists and trade experts largely expect Trump to further cut and damage trade relations between the world's two largest economies.

"Trump's re-election is likely to intensify trade and economic hostilities between the United States and China and deepen trade and financial decoupling between the two countries," said Eswar Prasad, professor of economics at Cornell University in the United States.

It is widely expected that Trump will face a challenge from current Vice President Harris.

On July 21, the current President Biden announced his withdrawal from the election and endorsed Harris. According to Professor Prasad and other experts, Harris's attitude towards China is similar to Biden's and will continue the moderate stance of the current Biden administration.

While both Trump and Biden have taken a protectionist stance on relations with China, their strategies and tactics differ widely, explained Prasad, who previously headed the International Monetary Fund’s (IMF) China and financial research department.

“Trump relied on imposing high tariffs to block imports from China. Biden, while maintaining some tariffs, is more focused on limiting China’s access to cutting-edge technology transfers and high-end computer chips,” he said.

Tariff war

Trump’s biggest shift in Biden-era trade policy — if he wins office again — could be to impose steep tariffs on Chinese goods.

The former U.S. leader, who calls himself "Tariff Man," sparked the U.S.-China trade war during his first term as president by imposing a series of tariffs on $250 billion worth of Chinese imports, ignoring warnings that the duties would raise prices and hurt American consumers.

After defeating Trump in 2020, the Biden administration came to power and he retained most of his predecessor's tariff policies and even added new tariffs, announcing tough new tariffs on about $18 billion worth of Chinese imports, including electric vehicles, solar cells, lithium batteries, steel and aluminum.

Experts said they expect Harris to largely continue Biden's tariff policy if elected. But on the other hand, Trump has declared that he will increase the tariff rate on Chinese imports by at least 60%. This will prevent Chinese products from entering the United States.

"I don't know if Trump would actually take such extreme measures, but I do believe he would probably raise tariffs to some extent in a second term," said Stephen Weymouth, professor of international political economy at Georgetown University in the United States.

Leading economist Stephen Roach says Trump raising tariffs in a second term would be a “functional andThe nuclear equivalent”。

William Reinsch, chairman of international business at the Center for Strategic and International Studies (CSIS), said the tariff war has the potential to spark another trade war that would end the exchange of most goods between the two countries at "enormous economic cost." This is literally nuclear-grade.

Even if Trump's goal is not to completely decouple China from the United States but to force China to negotiate a more favorable trade deal, Reinsch said there is little reason to believe that will work.

The Trump administration reached a "Phase One trade deal" with China in 2019, but few of its terms were fulfilled and subsequent phases never materialized.

Some commentators said Trump's selection of Senator Cyrus Vance as his running mate was a further sign that Republicans are serious about his tariff plans. The U.S. senator from Ohio has been a staunch supporter of tariffs on China, which he sees as the biggest threat facing the United States.

"If I were a Chinese policymaker, these policy choices made by Trump would make me tremble with anger," said Arthur Dong, professor of strategy and economics at Georgetown University in the United States.
Trump (right) and Vance were officially nominated as the Republican presidential candidate on July 18

Technology War

In contrast, the Biden-Harris administration’s key policies focus on limiting China’s access to technology transfers and implementing subsidy policies domestically to develop America’s own high-tech industries and supply chains.

The Trump administration significantly expanded the list of technologies and Chinese companies subject to U.S. export controls to cut support for key Chinese technology industries such as advanced semiconductors. The Trump administration has also enacted some similar controls.

The Biden administration also announced rules restricting U.S. investment in Chinese companies that develop sensitive technologies, citing national security concerns.

In August 2022, the Biden administration signed the CHIPS and Science Act, allocating nearly $53 billion to invest in domestic semiconductor manufacturing and research to increase the competitiveness of the United States with China. This is the Biden administration’s biggest move.

Chris Miller, author of "Chip War," noted that export controls and the CHIPS Act were passed with bipartisan support in Washington, so those policies are likely to remain a priority no matter what happens this November.

“I expect that no matter who wins the election, the United States will turn up the restrictions a notch or two,” Miller said.

Diplomatic War

A second Trump term — if there is one — would also affect U.S. diplomacy and the dialogue with Beijing, beyond just trade, said Rorry Daniels, managing director of the Asia Society Policy Institute.

She said channels for the world's two largest economies to discuss policy issues were drastically reduced during the Trump administration, while the Biden administration is emphasizing its diplomatic engagement efforts.

The administration has also sought greater coordination with so-called “like-minded partners,” for example lobbying Japan and the Netherlands to cooperate on semiconductor restrictions.

“Both of these will help minimize backlash from the Biden administration’s trade policy actions while also making them more effective in many respects,” said Nick Marro, lead global trade analyst at the Economist Intelligence Unit, who expects any future Democratic administration to retain this multilateral approach.
Harris to run against Trump for US president

Trump, on the other hand, will choose a more "go-it-alone" approach, allowing the United States to take restrictive measures against China more quickly.

While the Biden-Harris administration's "more cautious and careful" approach to trade and diplomacy between China and the United States has done a lot to stabilize relations between the two countries, Marro said he doubts China will be uncomfortable with either presidential candidate.

“I have a feeling that U.S.-China relations will remain in a state of near collapse for the rest of this decade, regardless of which party is in the White House.”

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