China exploits Trump tariffs to lock in trade dependence

Chinese policymakers are trying to turn Donald Trump’s tariff regime into a long-term strategic gift: a pretext to rewire global trade so that supply chains, standards, and financing routes run through Beijing rather than Washington.

According to a Reuters examination published by the Japan Times, Chinese state-linked researchers describe a systematic push to make the world’s biggest economic blocs—Europe, Gulf states, and a trans-Pacific trade framework—more dependent on Chinese manufacturing capacity and Chinese-controlled logistics corridors. The near-term opportunity is obvious: if the US makes itself a less predictable market via tariffs, exporters and governments will look for alternative “stability.” Beijing’s offer is not free trade in the classical sense; it is trade on rails China owns, financed by institutions China influences, and governed by technical standards China helps write.

Reuters reports China is accelerating a portfolio of roughly 20 trade deals, many years in the making, despite the objections: chronic overcapacity, asymmetric market access, and weak domestic demand. Those objections are precisely the point. Overcapacity is not a bug if your goal is to flood downstream industries, lock in dependency on your intermediate goods, and then negotiate from a position where the counterparty’s “industrial policy” becomes mostly an exercise in pleading for exemptions.

The West’s predictable response, the Reuters piece notes, is to reach for more state tools: industrial policy, export controls, licensing regimes. This is presented as “strategic autonomy,” but it’s a race between bureaucracies to decide who gets to buy, sell, ship, and build—and under what paperwork.

Beijing’s strategy relies on scale, coordination, and a willingness to treat commerce as a geopolitical instrument. Washington and Brussels respond by imitating the same logic—only with the added handicap of democratic politics and domestic rent-seeking. Export controls tend to metastasize into permanent permission systems. Subsidies become entitlements. Licensing becomes cartel protection for incumbents who can afford compliance.

Meanwhile, entrepreneurs—who actually produce the substitutes that would reduce dependency—get the least attention. If Europe wants fewer Chinese inputs, it needs faster permitting, cheaper energy, fewer labor rigidities, and a trade posture that welcomes competitive suppliers rather than anointed “champions.” If the US wants resilient supply chains, it needs predictable rules more than performative tariffs.

Beijing is betting that the West will choose the comforting illusion of control: more committees, more screening, more industrial planning. That bet has historically paid well—especially when the alternative is letting markets do what they do best: route around political vanity projects.