As China attempts to shift the economy away from exports and towards a “higher added value industrialisation and consumer-driven model”, Chinese premier Xi Jinping (left) will have to contend with threats from former US President Donald Trump (right) of 60% tariffs on Chinese imports, should he retake the White House. Credit: Qilai Shen / Getty.

Beijing will “react tit-for-tat but passively” to the latest reignition of the US-China trade war as Washington appears set to ban Chinese autonomous vehicle software, an analyst has predicted.

In the coming weeks, the US Commerce Department will likely propose banning Chinese software in autonomous and connected vehicles, Reuters reported.

Go deeper with GlobalData

Data Insights

The gold standard of business intelligence.

Find out more

Related Company Profiles

View all

Beijing’s attention on US protectionism has been piqued in recent weeks by the presidential election campaign, during which former President Donald Trump has promised a 60% blanket tariff against Chinese imports if re-elected.

It may add impetus to Beijing’s desire to “shift the [Chinese] economy from heavily export and investment-driven to a mix of higher added value industrialisation and consumer-driven model”, according to Minxiong Liao, economist and APAC director at TS Lombard.

However, “the reality is that an even more deficient domestic demand and an overcapacity in certain industries may lead to an export-reliant Chinese economy again”, Liao told Investment Monitor.

China desires stability in the international economic system, aligning with a ‘stay-and-maintain’ stance towards the US and Western powers until provoked. When President Biden imposed tariffs on $18bn of Chinese imports in May, Beijing’s response involved more bark than bite.

How well do you really know your competitors?

Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.

Company Profile – free sample

Thank you!

Your download email will arrive shortly

Not ready to buy yet? Download a free sample

We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form

By GlobalData
Visit our Privacy Policy for more information about our services, how we may use, process and share your personal data, including information of your rights in respect of your personal data and how you can unsubscribe from future marketing communications. Our services are intended for corporate subscribers and you warrant that the email address submitted is your corporate email address.

Speaking ahead of research firm TS Lombard’s Global Economic Changes and Challenges: What China is Thinking? webinar, Liao summarised this as Beijing tending to “react tit-for-tat but passively whenever the US deviates from the path – in a trade war for example”.

Attention in Beijing now focuses on the US elections and which leader Chinese Premier Xi Jinping will be dealing with come November.

Many in China’s political brass see it as more important to prepare early for the disruption of another Trump administration than the lesser-known Beijing playbook of all-but-certain Democrat candidate Vice President Kamala Harris.