By swinging the tariff cudgel,Trump is taking aim at the engine driver of China’s economy and its status as the world’s largest exporter,which saw it achieve a record $US1 trillion ($1.6 trillion) trade surplus last year.
China’s export sector has been the saving grace in the country’s otherwise sputtering economy,which is being dragged down by the long hangover of its property market collapse,high youth unemployment and an ageing population.
Delegates leave the Great Hall of the People after attending a preparatory session of the National People’s Congress in Beijing on Tuesday.Credit:AP
The brewing trade feud has ratcheted up tensions between Beijing and Washington on the eve of China’s top legislative body meeting to sign off on leader Xi Jinping’s priorities for the year ahead.
With Xi confronting mounting economic challenges and geopolitical uncertainty fuelled by an unpredictable White House,political officials and experts around the world will be closely watching for any policy shifts as China’s rubber-stamp parliament begins sitting on Wednesday.
Thousands of political cadres will descend on Beijing’s Great Hall of the People for the opening of the National People’s Congress,which will sit for a week to sign off on bills already approved by the Communist Party leadership.
The centrepiece of this highly scripted affair will be Chinese Premier Li Qiang’s delivery of the government work report,which will lay out the country’s economic blueprint for 2025.
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Many seasoned China watchers expect the report to double down on Xi’s long-term economic strategy of “Chinese-style modernisation”,which puts the state at the centre of industrial development and prioritises advancing high-tech industries while reducing Chinese supply chains’ reliance on Western technology.
Neil Thomas,a fellow on Chinese politics at the Asia Society Policy Institute,said the congress would probably approve some additional stimulus designed to boost consumer confidence,but it was unlikely to be the bazooka-style boost that many economists and investors have deemed necessary to kickstart the economy.
“Beijing has quite a history,including the Xi era and including before the Xi era,of making big statements about the importance of domestic demand and increasing consumption,and then either not wanting to,or not being able to,follow through on those commitments,” he said.
“We don’t think there’s any really super transformative policies in the pipeline that would point towards a fundamental realignment of China’s economic structure.”
The report is also expected to affirm China’s pursuit of global dominance in the artificial intelligence sector,which is critical for economic and military supremacy.
“AI is seen as something that can transform the real economy,as something that can provide benefits in a possible conflict with the US,” Antonia Hmaidi,a senior analyst with Mercator Institute for China Studies,said.
The report is expected to set a bullish target of 5 per cent GDP growth for 2025,unchanged from previous years,despite clear signs the economy is under significant strain and scepticism among Western experts about the government’s claims that it achieved the target last year.