China Focusing on Neighbours, Latin America and Africa to Withstand Trump Tariff

On the face of U.S. President Donald Trump’s high tariff, China is looking for fresh trade partners to fill the gap that the tariff may create. During this week, Chinese President Xi Jinping has visited three Asian nations—Vietnam, Malaysia and Cambodia—and signed dozens of agreements with each nation for mutual economic collaborations.

In fact, not just President Xi, but other senior leaders of China too are engaged in responding to the new economic situation that the Trump tariff has created. A few days back, Chinese foreign ministry spokesperson Lin Jian stated that China believes in “shaking hands” instead of “shaking fists”—in an apparent reference to Trump, who likes to display a fist in public appearances for his “Make America Great Again” policy. Thus, China wants not just to compete with the U.S. but also wants to score on moral high-ground, by trying to be nice with its partners.

As things now stand, the two nations have placed heavy tariffs on each other, and though there won’t be any upward mobility of the tariffs by either nation, China has given a thumbs down during the week to the U.S.’s wait for negotiation over the tariff. China, clearly, is in a mood for a direct head-on with the United States over trade.

While the U.S. has placed a 145 per cent tariff on China, China has placed a 125 per cent tariff on the United States. It is another matter that most analysts have warned of a global economic slow-down as a spill-over of the trade war between the two big economies of the world. A global economic slow-down or even recession may result, but neither the U.S. nor China is in any mood to allow its competitor a free sail.

How China wants to counter the new situation

As if China knew what was coming, it started to relax its tumultuous relations with its immediate neighbour India last year in November itself, before Trump entered office. China has called for deepening mutual trade between China and India, though India is going slow.

Secondly, China has already held meetings and entered into agreements for economic collaborations with Asian giants South Korea and Japan—though both South Korea and Japan look upon China with more suspicion than they look upon the United States. China, in fact, is emotionally closer to North Korea—North Korea being a common enemy of both South Korea and Japan.

Xi’s Asian Nations’ Tour this Week

Chinese President Xi’s visit to Malaysia, Vietnam and Cambodia points to China’s desperate effort to team up with every nation possible to take on the Trump tariff.

Vietnam faces a 46 per cent U.S. tariff, and hence Xi called upon Vietnam to join hands with China to oppose any “unilateral bullying” and strengthen production and supply chain.

Vietnam in any case has in the past borne the brunt of war during 1955 to 1975, when North and South Vietnam fought like hell with the U.S. and its allies supporting the South. However, the war ended with a U.S. debacle and unification of South and North Vietnam under communist rule.

Vietnam today has become a significant global manufacturing and export hub, particularly for electronics, textiles, and apparel.

Vietnam remains China's largest ASEAN trade partner. According to data available in the public domain, during the first three months of 2025, the bilateral trade volume between Vietnam and China reached US$51.25 billion, marking a 17.46 percent increase.

Xi also toured Malaysia to strengthen bilateral trade cooperations. Its manufacturing sectors include electronics, automotive, food and beverages, and rubber products. Blessed with a robust infrastructure and skilled workforce, Malaysia’s bilateral trade with China reached an all-time high of $212.03 billion in 2024, an annual increase of 11.4 percent.

With Cambodia, China joins hands “in building the Funan Techo Integrated Water Conservancy Project in accordance with the principles of feasibility and sustainability”. The canal project has been estimated at $1.16 billion with a length of 151.6 km. Cambodia is a big borrower of Chinese funds.

Thus, Trump tariff has forced China to concentrate on its immediate neighbours to develop close ties.

Trade Collaborations with African nations

China is Africa's largest trading partner, with trade volume exceeding $295 billion in 2024. For Africa, China is a major destination for exports. Its exports mainly consist of raw materials like oil, minerals, and agricultural products. As for China, it exports finished goods to Africa—particularly electronics and machinery—which usually results in a trade deficit for African countries.

Debt, however, is a big concern with many African countries relying on Chinese loans to build their infrastructure projects.

China in Latin America

China has managed to establish significant trade relations with Latin America and the Caribbean. South America is resource-rich, and China is there, right under the nose of the United States of America.

According to data, the trade between China and Latin America and the Caribbean increased up to 26-fold from the year 2000, reaching $315 billion.

Conclusion

According to an alert by the World Trade Organisation, shipment of goods between the U.S. and China may be cut by 80 per cent as an impact of the trade war between the two large economies of the world. This may result in global economic slow-down.

However, while the trade war is a reality now, both the U.S. and China are re-positioning themselves with nations globally with regard to trade—a kind of re-arrangement of global economic order.