China's Moment to Seize: A Trade War Escalation

As the geopolitical order shifts, China is taking advantage of the US's tumultuous trade policies, under President Trump's tariffs. Despite China's own retalizations, Trump's commitment to the strategy remains unyielding. Journalist A Martínez sat down with Orville Schell, an expert on US-China relations, to discuss the implications of this escalating trade war.

Key Takeaways:

• Orville Schell, director of the Center on U.S.-China Relations at the Asia Society, believes that China is in a prime position to seize the opportunity left by Trump's trade policies, but Xi Jinping's willingness to make concessions is uncertain.
• China's economy is heavily export-dependent, and the country needs to continue manufacturing to maintain its growth rate.
• The ongoing trade war could be damaging to both the US and China in the long term, particularly due to the use of choke points on each other's economies, such as microchips and rare earths.
• The US's ability to extract rare earth minerals domestically is limited, and most of the ore is still sent to China for processing.
• The rest of the world could face disruptions as the US and China figure out their trade dynamics, and higher costs for manufacturing and supply chain disruptions are possible.
• Orville Schell notes that global supply chains are complex and dependent on multiple countries, making them vulnerable to disruptions caused by the trade war.

Statistics:

• 10%: The current tariffs on imports from most countries.
• 145%: The tariffs on imports from China imposed by the US.
• 99%: The percentage of Iran's oil that China buys.
• 20%: The global share of rare earth minerals that China controls.
• 70%: The percentage of global microchip production that occurs in China.
• $10.8 billion: The value of US rare earth mineral exports in 2020.