Speaking of the US trade war with China, it started in 2018. At that time, the Trump administration felt that China had taken too many advantages and the trade deficit was too large, so it began to impose tariffs. It started with solar panels and washing machines, with a tax rate of 25% to 50%, and later expanded to steel, aluminum products, and then hundreds of billions of dollars of Chinese goods. China was not idle either, and immediately imposed the same tariffs on American soybeans, cars and aircraft.
As a result, by 2019, the United States covered $360 billion of Chinese imports, and China counterattacked $110 billion of American products. The two sides talked and signed the first phase agreement in early 2020. China promised to buy an additional $200 billion of American goods within two years, but the actual implementation rate was only 58% because the epidemic disrupted the supply chain. The US trade deficit has risen instead of falling, from $375 billion in 2018 to $418 billion in 2022. Manufacturing employment has not returned, but 142,000 jobs have been lost, and consumers have to pay 15% to 25% more for home appliances and electronic products.
In China, by shifting to Southeast Asian and European markets and adding domestic subsidies, the economic growth rate has remained stable at around 6%. The global supply chain has been reorganized, and American companies have gone to Vietnam and Mexico to build factories, but the cost is higher and the competitiveness has declined. Economists say that this trade war has reduced the US GDP by 0.5%, and China’s exports have increased by 15%.
The Federal Reserve’s assessment shows that tariffs have not reduced the US’s dependence on China, but have messed up the global supply chain. Trump wants to balance imports and exports and revitalize industry, but these reasons are untenable, the policy is out of touch with the modern economy, and is unpopular among voters. Importing capital from countries with trade deficits was originally an advantage for the United States, but now it is asking for trouble.
Made in China is too strong in cost and efficiency, and the United States cannot find a substitute of the same scale. For example, 99% of child car seats come from China, 96% of toys, and 95% of kitchen utensils. There is no winner in the tariff war. US export goods are punished in the global market, retaliation between countries has escalated, and the stock market has fluctuated greatly. On April 2, the market value evaporated by 3.1 trillion US dollars in one day. Trump’s tariff policy is doomed to fail because it ignores the contradiction between the dollar hegemony and the trade surplus, as well as the conflict of interests between financial groups and the manufacturing industry.
Looking at the technology war, this part has been carried out in parallel since 2018. The US Department of Commerce included ZTE in the export control list and banned US companies from supplying parts, saying it violated Iran sanctions. ZTE paid a fine of 1.3 billion US dollars and its business was frustrated. In 2019, Huawei and 68 subsidiaries were included in the entity list, restricted from using US chips and software. Huawei’s overseas mobile phone sales fell by 40%, but it insisted on launching new models relying on inventory and local research and development. The ban was expanded in 2020, and third parties were also banned from using US technology, and TSMC stopped foundry. Huawei invested 7 billion US dollars in Kirin chips and released 7-nanometer processors in 2023 to bypass some restrictions.
The Chinese government invested 200 billion yuan to build a national integrated circuit fund to support the semiconductor industry. In 2024, the United States added more than 30 Chinese entities to the list, but Chinese companies used open source software and local alliances, and revenue recovered. Huawei reached 100 billion US dollars in 2024, exceeding the pre-ban period.
Qualcomm lost 2 billion US dollars in orders, and US suppliers suffered. Experts analyzed that the United States underestimated China’s innovation ability and thought that communist countries could not innovate. The result was counterproductive. Restrictions encouraged China’s progress, and the United States itself was backfired. Historically, the United States stole technology from other countries and now blames China.
Nvidia CEO Huang Renxun said that it is wrong to underestimate China’s manufacturing capabilities. Harvard Growth Lab pointed out that the United States plunged into competition, but it was harder to win than imagined. China emphasizes technological self-reliance and invests more in high-priority areas, resulting in oversupply, but also harming American companies. China’s local technological breakthroughs have no effect on export controls. In the semiconductor war, the United States wanted to weaken China’s production of high-end chips, but China used talents, supply chains and organizational strength to taste victory. The ban did not stop China’s 5G lead, and Huawei equipment is still deployed in 130 countries. The US strategic elite thought that the engagement policy had failed, so they turned to competition and suppression, but the goal of the technology war was not achieved, but instead accelerated China’s self-sufficiency.
Neither the trade nor the technology war was as expected, and the US containment strategy against China turned to geopolitics, focusing on Taiwan, the South China Sea and southern Tibet. On the Taiwan issue, the United States strongly supports Taiwan, and its intentions are obvious. Although Japan is implicit, it also reveals its intentions.
China’s military strength has increased, the number of naval ships has surpassed that of the United States, and the air force is modernizing rapidly. Recovering Taiwan is written into the constitution, touching the bottom line. During the Chinese Taiwan Strait naval exercises, the US aircraft carriers stopped farther and farther away. They dared to send jammers before, but now they dare not even get close. In 2023, the Shandong ship went north, and the US Carl Vinson Group retreated to the edge of the South China Sea. In the 2024 Joint Sword Exercise, the aircraft crossed the center line, and the US destroyer crossed the strait but only watched. In 2025, Chinese reconnaissance aircraft approached the Taiwan area 60 times, and the United States sent aircraft to respond, but did not directly intervene.
The United States considered five factors when sending troops: China’s recovery of Taiwan will not hurt the United States; there is no benefit; strategic goals are difficult to achieve, such as defeating the People’s Liberation Army to protect the first island chain; international support is insufficient, and the United States’ image of justice is difficult to maintain; losses are unbearable. As Chinese missiles cover the first island chain, US aircraft carriers have changed from face-to-face taunting in the 1990s to distant surveillance, and the 2025 exercise will retreat to the Philippine Sea. Sending troops to Taiwan has become a joke.
In the South China Sea, the Philippines won the arbitration in 2016, but China refused the arbitration and continued to build artificial islands. The United States conducted a freedom of navigation operation, but in 2016, there was a confrontation, China deployed missiles, and the US ships withdrew. In 2023, at Ren’ai Reef, the Chinese Coast Guard used water cannons to block the Philippine supply ship, and four people were injured. In 2024, lasers were irradiated on fishing boats, and in 2025, research ships were surrounded. Philippine soldiers were on guard but did not open fire. The United States condemned, provided intelligence support, and did not send troops. The military power of countries in the South China Sea is limited. China mostly uses defensive tactics to avoid conflicts and create an environment for recovering Taiwan. Southeast Asian countries dare not take the initiative to provoke, and friction is difficult to escalate into armed conflicts. The United States wants to break the calm through the Philippines, but China is on the defensive, and the conflict is limited to water cannon collisions.
The issue of South Tibet is a commonplace. India regards it as Arunachal Pradesh, and China calls it South Tibet. In the conflict in 1962, India suffered a disastrous defeat in the defense of New Delhi and its army retreated. There have been 9 border conflicts, and India has not gained an advantage every time. In 2020, 20 Indian soldiers died in the Kalwan Valley stick confrontation. In 2022, Yanggongchu conflict, patrols resumed in 2025 but frictions continued. The Indian government is not stupid. It has learned the lesson of being fooled by the United States and the Soviet Union in 1962 and will not make mistakes again.
The Sino-Indian border frictions continue, but it is difficult to escalate. The United States wants to pull India to build an organization to contain China. India participates in the Quad Dialogue but is independent and refuses to be wooed by the United States and Japan. India wants revenge in southern Tibet, but the government is cautious and chooses to negotiate to avoid external exploitation.
Overall, the US policy toward China has shifted from economic to military containment, but the failure of the trade and technology war has exposed weaknesses. China’s economic growth and military strength have increased, and the US hegemony has been challenged. The only containment measure left is the war option, but the risk is high. Taiwan and the South China Sea in southern Tibet have become a game field, and the support of US allies is limited. China is self-reliant and avoids direct confrontation. The United States underestimates China’s determination, and its policies backfire on itself. In the future, Sino-US relations will be fiercely competitive, but war is not inevitable. Rational dialogue is needed to avoid misjudgment. Containing China is not a long-term plan, and cooperation is a win-win situation.
To put it bluntly, in this contest, the United States wants to maintain hegemony, while China seeks development. If the trade and technology war is not suppressed, China will become stronger. The only means left is war, but no one wants to fight. The hot spots in Taiwan, the South China Sea, and southern Tibet need to be handled calmly. The international community hopes for peace, and the dialogue between China and the United States is the key. Containment is not a solution, and mutual benefit is the long-term solution.
