Trump 2.0: a new era of trade confrontations and military escalations with China and Russia?

Russia and China have the most at stake in the United States presidential election. With the historic return of Donald Trump, each country will feel the impact differently. Given his first presidential term from 2017 to 2021 and current rhetoric, Trump’s leadership could impact military tensions, economic relations and sanctions.

Trump’s position on China: trade, technology and tariffs

“China will continue to work with the United States on the basis of mutual respect, peaceful coexistence and win-win cooperation,” a Chinese Foreign Ministry spokesperson said just before Donald Trump emerged victorious as the 47th president of the United States.

During his previous term, Trump took an aggressive stance toward China, attacking China for trade imbalances and intellectual property theft. The trade war between Washington and Beijing, which reached a fever pitch during his time in office, is considered one of the most consequential economic confrontations. The Trump administration initially imposed tariffs on $50 billion of Chinese imports in response to the country’s alleged unfair trade practices, the Office of the United States Trade Representative reported.

By the end of his term, cumulative tariffs had risen to approximately $550 billion. Beijing retaliated by announcing tariffs on $185 billion worth of US products, hampering growth in sectors such as agriculture and technology. According to the International Monetary Fund (IMF), this economic friction between the countries resulted in a dip in China’s GDP growth, declining by almost 0.2-0.4% per year from mid-2018 to 2020.

As Trump returns to office, a trade policy with tariff boosts is expected to further strain US-China relations. Citing national security concerns, his government could consider raising tariffs or re-imposing strict policies on Chinese tech giants like Huawei and TikTok. The experts also believe that Trump would also introduce stricter sanctions to limit Chinese progress in AI and 5G.

“The nation that controls the global production network of this crucial instrument has unprecedented geopolitical power. Given the PLA’s aggression in the region and Beijing’s unfair market practices, China taking this position does not bode well for the Indo-Pacific – or the world,” says the East Asia Forum in its “US chip sanctions may not be enough to deter China.” military ambitions’.

Beijing’s trade surplus with the rest of the world grew sharply in 2019. In 2022, the surplus with the European Union increased by 144%, from $113 billion in 2019 to $276 billion. Amid the pandemic, Chinese exports soared, creating a record trade surplus of $690 billion in 2021, up 28% year-on-year.

Military tensions in Indo-Pacific and Russia-China relations

After re-election, Trump could focus on the Indo-Pacific and increase US military presence in the region, directly challenging Beijing’s influence. According to the US Department of Defense report, the Trump administration increased military spending for the Indo-Pacific by 16% between FY 2019 and FY 2020. Given his aggressive geopolitical policies, Trump could consider deploying more resources in the South China Sea and Taiwan Strait, increasing the risk of military involvement with China.

Trump 2.0 could also have an impact on Sino-Russian ties. These countries have strengthened their partnership, marked by increased joint military exercises and energy cooperation, including the Power of Siberia pipeline and gas supplies to China, during Trump’s previous term.

Economic policy: tariffs and sanctions against Russia

On Russia, Trump has indicated he might consider lifting some sanctions if the country helps negotiate a peace deal in the Russia-Ukraine war. While he has not outlined any plan, sanctions relief could be part of his strategy to facilitate a solution.

To reduce Europe’s dependence on Russian energy, Trump’s administration promoted U.S. LNG exports to the region in an effort to destabilize the Russian economy. According to sources such as the International Energy Agency (IEA) and the World Bank, energy exports, including oil, gas and coal, typically account for about 50% to 60% of total Russian exports. The further shift away from Russian energy would directly impact the crucial revenue stream.

On the other hand, his continued criticism of NATO allies’ defense spending has raised concerns about weakened transatlantic unity. This sentiment favors Russia’s defense strategy, as it weakens the bloc’s deterrent capacity. Trump’s victory would lead to a resurgence of skepticism and increase the likelihood of weakening collective defense momentum.

Impact on the global economy and the US trade deficit

Although the Trump administration’s policies had produced mixed results in terms of the US-China trade deficit, the attempt to regain manufacturing jobs through the imposition of tariffs had minimal success in reducing the trade deficit. According to US Census Bureau data (2020), the trade deficit between countries remained significant, increasing to US$345.6 billion for goods alone in 2019, despite the tariffs imposed during the trade war. His policies favor protectionism and reshoring, which could potentially lead to expensive imports, but also higher investments in domestic industries.

Trade disputes during Trump’s first term as president had significant economic consequences. According to OECD findings, such a conflict could lead to a slowdown in global GDP growth of almost 0.3%. If Trump pursues policies aimed at destabilizing Russian energy markets and promoting American LNG in Europe and Asia, Russia could face further challenges.

In conclusion, Donald Trump’s return to the White House could reshape US relations with Russia and China, increasing economic tensions, trade wars and military posture in key regions. While specific policy choices remain uncertain, his record and public statements suggest an emphasis on reasserting U.S. dominance, especially through economic sanctions, tariffs, and military reinforcement in the Indo-Pacific.