Hurricane Trump rips into China’s corridors of power
The US President sets the stage for Trade War 2.0 after Secretary of State Rubio’s Beijing barbs
China is bracing for Hurricane Trump amid a deepening crisis in the world’s second-largest economy. If there were any doubts about the ill wind whistling through the corridors of power in Beijing’s Great Hall of the People, they were put to rest this week.
Marco Rubio did not pull any punches as US President Donald Trump’s new Secretary of State during his confirmation hearing in Washington six days ago. “We welcomed the Chinese Communist Party into this global order,” the China hawk said.
“They have lied, cheated, hacked and stolen their way to global superpower status at our expense,” Rubio, who has been banned from visiting the country by the ruling Communist Party, added in a scathing attack on President Xi Jinping’s regime.
Problems piled up on problems:
- Trump’s stance on China threatens an economy in dire straits.
- The nation’s GDP growth of 5% last year was grossly exaggerated.
- Research firm Rhodium Group used key data and came up with under 2.8%.
Between the lines: “There is a big gap between their narrative and economic reality,” Logan Wright, the director of China markets research for Rhodium, said, as reported by The Wall Street Journal.
These growth figures stretch the bounds of credibility.
Eswar Prasad at Cornell University
Delve deeper: His assessment was echoed across the economic stratosphere. Eswar Prasad, professor of trade policy and economics at Cornell University and a former head of the International Monetary Fund’s China division, also questioned the numbers.
Between the lines: “These growth figures stretch the bounds of credibility and will do little to build confidence or alter the picture of an economy on the ropes,” he said.
Big picture: With Rubio running the US State Department and Trump’s ‘love affair’ with tariffs, Beijing is preparing for Trade War 2.0. It comes at a time when Xi and his inner circle are grappling with a raft of domestic challenges.
Bottom line: “During the Trump 2.0 era, [Washington’s] China policy will continue its aggressive suppression and containment of our country [by] curbing China’s strategic competitiveness,” Zhu Feng at Nanjing University said as reported by Sinification.
China Factor comment: Beijing has already started to batten down the hatches as Hurricane Trump blows into town. The president’s transactional policies also mean that China knows that close US allies risk being targeted by his “American First” strategy.