Global Impact | China posts better-than-expected first-quarter growth, but US trade actions test outlook

Global Impact is a weekly curated newsletter featuring a news topic originating in China with a significant macro impact for our newsreaders around the world

In this week’s issue, we take the temperature of US-China relations at a difficult time for Beijing as it seeks to solidify the recovery of the world’s second-largest economy

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Published: 2:00pm, 22 Apr 2024Updated: 1:20pm, 23 May 2024

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As former US president Donald Trump fights hush money charges in a New York courthouse, his successor and 2024 election rival Joe Biden was busy adopting the same hawkish posture on China which characterised much of Trump’s own administration.

Biden on Wednesday called for the tripling of current tariffs on Chinese steel and aluminium to 22.5 per cent, while also pressuring Mexico not to obscure the origin of certain Chinese products shipped to the United States.

On the same day, the Office of the US Trade Representative initiated a Section 301 investigation into China’s maritime, logistics and shipbuilding sectors over alleged “unfair and non-market” practices.

With the US continuing its “small yard, high fence” plan of tech containment and pondering an outright ban of TikTok – and with countermeasures against China’s industrial overcapacity in the offing, including but not limited to high tariffs – a trade war 2.0 is looming large, one which would deal another major blow to already impaired relations between Beijing and Washington.

Beijing responded to the news with strong protests, calling the proposed action “typical protectionism” that could disrupt global supply chains and vowing to take all necessary retaliatory measures.