-Ali Khan Zadran

#USChinaTensions
President Donald Trump’s trade war with China that began in his first administration has snowballed into greater tensions between the world’s biggest economies, but experts say completely decoupling from one another is likely impossible.

Many experts say escalations have not subsided since 2018, when Trump imposed tariffs on hundreds of billions of dollars worth of Chinese goods. At the time, the president claimed the levies would decrease the U.S. trade deficit with China, bring back manufacturing jobs to the United States, and force China to reform its trade practices, including intellectual property (IP) theft. Few of these promises materialized. Meanwhile, China retaliated with its own tariffs on U.S. goods and has even imposed export controls on critical minerals central to the manufacturing of automobiles, semiconductors, and military weapons worldwide.

In 2020, Trump negotiated a so-called Phase One agreement with China that called for resolving the trade war and outlined protections for U.S. trade and commitments from the Chinese government to reform some of its trade practices. Many experts criticized the deal as punting on core U.S. concerns in exchange for a commitment by Beijing to purchase an additional $200 billion worth of U.S. goods—which it failed to live up to.

Biden retained some $360 billion worth of tariffs from Trump, even increasing the levy for certain competitive industries. For instance, Biden quadrupled tariffs on electric vehicles made in China, tripled those on steel and aluminum, and doubled the duty on semiconductors; introduced unprecedented export controls that restrict Beijing’s ability to obtain advanced technology; and banned some U.S. investment in sensitive technologies that lawmakers fear could be used to aid China’s growing military.

The trade war that started in 2018 resulted in both countries experiencing economic pains; U.S. economic growth slowed, the trade deficit continued to grow, and studies found that U.S. companies primarily bore the cost of the tariffs. CFR Fellow for Trade Policy Inu Manak says these tariffs largely fail to divert trade away from China in a global economy. As China moves production to other parts of the world, the United States eventually purchases Chinese goods from other trade partners, such as Mexico and Vietnam