US-China Trade War

Battles lines drawn between the world's two largest economies
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Background and explainers on the trade war between China, led by President Xi Jinping, and the United States, and its President Donald Trump. Having started in July 2018, the prolonged conflict reached a turning point in January 2020 with the signing of the phase one trade deal, but not after it had weighed heavily on the global economy for 18 months due to additional import tariffs levied by both China and the US. The US has accused China of unfair trading practices, including intellectual property theft, forced technology transfer, lack of market access for American companies in China and creating an unlevel playing field through state subsidies of Chinese companies. China, meanwhile, believes the US is trying to restrict its rise as a global economic power.

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Diplomacy
Illustration: Brian Wang
Diplomacy
Trump-Xi diplomacy put to test thanks to contentious tit-for-tat Covid lawsuits
Unpaid billions of dollars in judgments against China sucks US State Department into escalating legal dispute, but Beijing remains defiant.
7
A ship is under construction at a shipyard in China’s eastern Jiangsu province. China remains the world’s top shipbuilder, but its market share dipped last year amid uncertainty over US port fees. Photo: AFP
China Economy
China’s shipyards still lead the world, but US threats took a toll in 2025
Chinese shipbuilders saw their market share dip for the first time in five years in 2025, as uncertainty over US port fees roiled the industry.
3
A worker helps make semiconductor chips for export at a factory in China’s Shandong province. Japan has a commanding market share in semiconductor equipment and materials. Photo: AFP
Global Economy
With US focused on Venezuela, China has window to pressure Japan: analysts
Beijing’s trade actions raise stakes with Tokyo, as China’s rare earth power and Japan’s chip dominance are seen as potentially key levers in their bilateral dispute.
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White House trade adviser Peter Navarro speaks to reporters in Washington in August. Photo: TNS
United States & Canada
US will end China’s dominance of rare earths, Trump adviser Navarro predicts
The president’s trade aide says American innovation will ‘quickly wipe away’ Beijing’s ‘weaponisation’ of critical minerals.
30
A Chinese flag is displayed next to a “Made in China” sign seen on a printed circuit board with semiconductor chips. Photo: Reuters
China Economy
China says US trade war, tech curbs have spurred ‘independent innovation’
In the first year of new five-year plan, party mouthpiece says list of ‘chokepoint technologies’ is narrowing.
4
The Manus AI logo is seen displayed on a smartphone screen with the Meta logo in the background. Photo: Getty Images
Big Tech
China to probe Meta’s purchase of Manus over export controls, tech concerns
Probe comes amid concerns the US$2.5 billion acquisition could breach tech export controls and encourage more start-ups to relocate offshore.
6
Cars come off the assembly line at BYD’s plant in Zhengzhou, central China’s Henan province. Photo: Xinhua
China
BYD’s win, Tesla’s defeat, Ford’s pivot: the widening gap in US-China EV markets
From wavering policy to cost gaps, analysts say decades of state backing have given China a decisive edge over US rivals.
1
US White House Press Secretary Karoline Leavitt addresses the media during a press briefing in Washington on Wednesday. Photo: EPA
Diplomacy
US won’t rule out pressuring Venezuela to curb China, Russia ties
White House vows continued ‘American dominance in the western hemisphere’ as Trump claims Caracas will now buy ‘only American-made’ products.
74
A worker is seen at a semiconductor factory in China’s Jiangsu province. Beijing has launched an anti-dumping investigation against Japan over a chemical used in chipmaking. Photo: AFP
Global Economy
China initiates anti-dumping probe against Japan over key semiconductor chemical
Beijing’s investigation targets imports of dichlorosilane from Japan, alleging dumping that harms Chinese production, amid escalating bilateral and trade tensions.
5
A man walks past a sculpture outside a building of Venezuela’s state oil company PDVSA in Caracas, Venezuela, on May 17, 2019. Photo: Reuters
World Opinion
Opinion|Why Asia should be concerned about the US attack on Venezuela
Venezuela matters less as a case in itself than as a signal of how energy is being repositioned amid intensifying US-China competition.
FactSheet|Price wars in China
Intense price competition in China, known as “neijuan” or involution, is causing deflationary risks, corporate losses, reduced investments and wage pressure.
US President Donald Trump, flanked by senior members of his administration, speaks to the press following American military strikes on Caracas, Venezuela. Photo: TNS
China Economy
Not just oil: is Trump’s Venezuela takeover also about critical minerals?
Venezuela, Greenland and Colombia all have large deposits of rare earths and other minerals needed by US technology and defence companies.
26
US Secretary of War Pete Hegseth arrives for a briefing with bicameral congressional leadership in Washington on Monday. Hegseth believes the recent US military operation in Venezuela proves that his country is rebuilding its military dominance. Photo: Getty Images via AFP
Diplomacy
China, Russia won’t ‘dare test’ US, says Hegseth after Venezuela military op
US Secretary of Defence believes show of ‘absolute deterrence’ sends clear message to their ‘enemies’ and the ‘world is taking notice’.
138
Ro Khanna has been named as the senior Democrat on the bipartisan House Select Committee focused on competition with China. Photo: TNS
Diplomacy
California progressive to lead Democrats on influential House China panel
Ro Khanna to replace Illinois Representative Raja Krishnamoorthi, who is making a Senate run, on the House Select Committee monitoring China.
US President Donald Trump listens as he was speaking with reporters on Air Force One on Sunday. Photo: AP
China
Trump seen as top global risk in 2026 as US slips further behind China
Forecast warns China’s shift towards an ‘electro-state’ could widen the gap with the US, even as deflation clouds Beijing’s outlook.
12
Illustration: Lau Ka-kuen
Global Economy
‘Embrace the moment’: on China, Daniel Kritenbrink puts pragmatism first
Former US ambassador to Vietnam says a return to the past for US-China relations is unrealistic, but both economic powers benefit from ties.
2
People look at phones in the Haikou International Duty Free Shopping Complex in Hainan province, on December 18, the day China launched island-wide special customs operations in the Hainan free-trade port. Photo: Xinhua
Hong Kong Opinion
Opinion|How Hong Kong can complement Hainan’s free-trade port
Jointly designed customs rules could be used in pilot schemes to smooth the customs process for international business.
US President Donald Trump is blocking HieFo from acquiring semiconductor-related assets from Emcore, citing national security worries. Photo: AP
Diplomacy
Trump orders Chinese-linked firm HieFo to divest US chip assets
Chinese-linked company ordered to unwind its acquisition of US semiconductor assets, citing national security concerns.
44
US President Donald Trump shakes hands with David Perdue during Perdue’s swearing-in ceremony as the US Ambassador to China at the White House in May. The pair are set to meet at Trump’s Mar-a-Lago estate in Florida on Friday. Photo: Reuters
Diplomacy
Trump to meet US’ China envoy after call with Japanese PM Takaichi
Trump and Takaichi telephone conversation reaffirms ‘close coordination’ of US-Japan alliance and hopes of a ‘new chapter’ for partnership.
18
The Panama port deal still hung in the balance by the close of 2025. Photo: AFP
Hong Kong Economy
Could 2026 be the make-or-break year of CK Hutchison’s Panama ports deal?
What began as a strategic exit for a Hong Kong conglomerate has devolved into a high-stakes stand-off between Washington and Beijing.
1
Illustration: Lau Ka-kuen
Amid US-China trade war truce, ex-diplomat preaches realism
Daniel Kritenbrink, once the top US diplomat for East Asia, doesn’t see a wider thaw in relations despite upcoming meetings between Donald Trump and Xi Jinping.
A pedestrian walks past a stock market indicator board on the final trading day of the year in Tokyo on December 30. Notable outperformers for 2025 included the Nasdaq, Japan’s Nikkei 225, Hong Kong’s Hang Seng Index and South Korea’s semiconductor-rich Kospi. Photo: EPA
World Opinion
Opinion|Rising markets, falling interest rates and more: 5 investment myths for 2026
Investors must be careful in following conventional wisdom this year as several seemingly sure bets might be anything but.
1
Vendors work at the Yiwu International Trade Market, a vast emporium for wholesale goods often dubbed the “world’s supermarket”, in Yiwu, Zhejiang province. The city has recorded strong growth in exports this year despite the US-China trade war. Photo: AFP
China Economy
How the ‘world’s supermarket’ rode out Trump’s tariffs – and grew even stronger
Yiwu, one of China’s biggest export hubs, was expected to take a hit from US tariffs. Instead, it has seen trade surge.
14
Robots carry out welding operations at the FAW-Volkswagen production based in Jimo district, Qingdao, eastern China’s Shandong province, on February 19. Photo: AFP
China Economy
China’s next decade to cement status as hi-tech manufacturing power: reports
The coming 10 years will see significant advances in cutting-edge sectors, reinforcing industrial dominance, according to new reports.
7
A combine harvests a soybean field in Tracy, Minnesota, in October. Photo: TNS
United States & Canada
China buys two-thirds of pledged US soybeans as 2025 closes
Beijing has moved to reduce tariffs on the crop and lifted import bans on three US exporters after talks between Xi and Trump.
4
Bars of silver are stacked at a processing plant in Glogow, Poland. Spot silver briefly surpassed US$80 an ounce for the first time in December. Photo: Reuters
Global Economy
China’s January 1 silver curbs to deepen global crunch amid volatility: analysts
Beijing’s new export-licensing system seen squeezing foreign buyers, pushing price towards US$100 an ounce; Elon Musk joins warning chorus.
5
Handlers move cattle at a livestock market in Canuelas, Argentina, in October. China is kicking off 2026 with additional tariffs on beef imports exceeding specific quotas for major trading partners. Photo: AP
Global Economy
China imposes beef-import quota, adds over-quota tariffs to guard local industry
From Thursday, over-quota imports from Brazil, Australia, US and other trade partners face new duties to help local producers recover amid price declines.
1
US President Donald Trump salutes after disembarking from Air Force One at Joint Base Andrews on October 30. Photo: Reuters
World Opinion
Opinion|Why Donald Trump will focus on the Fed in 2026
With the US midterm elections looming, the White House seeks victory over inflation and the stimulating effects of lower borrowing costs.
Opinion
Macroscope|Can a world obsessed with greed and power avoid a war in 2026?
The desire for economic growth and military might is driving the world towards conflict while devaluing concepts such as mutual respect and peaceful coexistence.
Anthony Rowley
2
Outside In|2025 was the year of denial. What now?
Despite the threat of wars, tariffs, climate change and AI, normality has persisted. But it can only be a matter of time before such contradictions explode.
David Dodwell
1
Outside In|As the US pursues unilateralism, China faces challenging task as Apec host
China’s return as Apec chair is an opportunity to show that both the organisation and its message of multilateralism are as relevant as ever.
David Dodwell
Editorial|Less hostility towards China in new US security strategy is welcome
The plan’s watering down of America’s antagonism towards China bodes well for both nations and the world.
SCMP Editorial
Editorial|Export curbs or not, Trump’s America can’t slow China’s tech surge
US debate over how to contain China’s tech development is irrelevant as Chinese domestic industry development has already taken full flight.
SCMP Editorial
2
Outside In|It’s an expensive Christmas for Americans thanks to Trump’s tariffs
It’s been years since the US president extolled the virtues of trade wars: how much longer before he recognises tariffs harm the US economy?
David Dodwell
2
As I see it|How Nexperia became a casualty of the US-China trade war
Unless the two superpowers reach a long-term solution to trade tensions, smaller companies and economies will get caught in the crossfire.
SCMP ColumnistAlex Lo
22
Editorial|China’s commitment to globalisation evident at import expo
The event also underlined the importance of mainland consumers as growth drivers for the world economy.
SCMP Editorial
The View|Busan truce foreshadows turning of tide in US-China power balance
What has become evident is that the US needs other countries to agree to its plans and help enforce them, while China is strong enough to act on its own.
Winston Mok
1
Macroscope|Exports no longer enough to lift Asia out of ‘middle-income trap’
Developing nations are being urged to boost domestic demand and mutual trade to drive growth, but key factors like population ageing must also be addressed.
Anthony Rowley
2
As I see it|How Deng Xiaoping secured China’s winning hand in the tech war
Years before Washington would target Beijing’s tech industry, the Chinese leader unleashed the country’s scientific potential.
SCMP ColumnistAlex Lo
10
Macroscope|Has Trump 2.0 really been a boon to stock markets and the economy?
Although asset prices performed strongly this year and there has been no recession, Trump’s second term is a Rubicon-crossing moment for the US and global economy.
Nicholas Spiro
1
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