Since Donald Trump returned to the White House in January 2025 with an “America First” agenda, U.S.-China relations have been marked by escalating trade and technology disputes. Trump’s policies, including tariffs exceeding 100% on certain Chinese goods, created significant uncertainty for international markets and for China’s global trading partners. Yet Beijing responded strategically, boosting exports to non-U.S. markets, supporting private enterprises, and pursuing diplomatic and economic ties with key countries such as Canada, India, and the European Union. Analysts say China has positioned itself as a stable and reliable alternative at a time when the U.S. is perceived as unpredictable.
China’s Global Trade Expansion
Despite declining shipments to the United States down 20% in 2025 China increased exports to Africa by 25.8%, Latin America by 7.4%, Southeast Asia by 13.4%, and the European Union by 8.4%. Its trade surplus hit a record $1.2 trillion, and monthly foreign exchange inflows reached $100 billion, the highest ever. In addition, China’s financial markets showed resilience: the Shanghai index rose 27% over the past year, market turnover hit record highs, and the yuan expanded its global usage. Economists credit these outcomes to a combination of proactive trade diversion, domestic stimulus, and strategic outreach to international partners.
Diplomatic Engagements: New Partnerships
Recent high-profile visits from global leaders underscore Beijing’s renewed diplomatic momentum. Canadian Prime Minister Mark Carney signed an economic deal with China to reduce trade barriers, calling China “a more predictable and reliable partner.” British Prime Minister Keir Starmer is set to visit China for the first time since 2018 to revive strained business ties. Meanwhile, India and the European Union finalized a long-delayed trade agreement, aiming to slash tariffs and potentially double European exports to India by 2032. Analysts note that these moves reflect a broader “pivot to China” by countries seeking stable trade relationships amid uncertainty in U.S. policy.
Domestic Economic Resilience
At home, China’s economy has faced structural challenges, including deflationary pressure from weak consumption and a long-term slump in the property sector. Despite this, the country met its government growth target of 5% in 2025. Beijing has also rolled out initiatives to attract foreign investment, with pilot programs in Beijing, Shanghai, and other regions opening service sectors like telecoms, healthcare, and education to greater international participation. Forex reserves reached a ten-year high of $3.36 trillion, while the yuan now accounts for more than half of China’s cross-border transactions and nearly half of its overseas bank lending—a marked increase from virtually zero 15 years ago.
Yuan Internationalization and Global Influence
With the dollar losing appeal due to perceived U.S. unpredictability, China is actively promoting the international use of the yuan. Global banks are establishing offshore liquidity hubs and faster payment settlement frameworks to facilitate yuan-based trade across Southeast Asia, the Middle East, and Europe. According to bankers with knowledge of the process, Trump-era policies are “very conducive” to expanding yuan usage. Analysts note that China’s approach is more deliberate and systematic than previous efforts to internationalize its currency, reflecting Beijing’s strategic focus on long-term financial influence.
Cautions and Limitations
Despite the apparent successes, some analysts urge caution. Patricia Kim of the Brookings Institution points out that while countries may view China as a more predictable partner compared to the Trump administration, deep-seated concerns remain. Issues such as China’s use of economic coercion, unresolved maritime disputes, and historical grievances continue to make allies wary. Analysts argue that Beijing’s current restraint may be pragmatic rather than indicative of trustworthiness, and that long-term geopolitical competition with the U.S. is likely to continue shaping global economic alignments.
Analysis: Strategic Pivot and Global Positioning
A year into Trump’s presidency, China’s response highlights its ability to leverage U.S. unpredictability to expand influence and secure economic partnerships. By diversifying trade, strengthening financial markets, and promoting the yuan globally, Beijing has positioned itself as a “steady partner” for nations seeking predictability. However, the success of this pivot is tempered by lingering concerns over governance, coercive economic practices, and regional security issues. While countries may engage with China out of necessity or pragmatism, the long-term implications for U.S.-China rivalry and global economic order remain uncertain.
With information from Reuters
