In a shocking series of escalations, last week saw the US government unleash a 145% punitive rate against China. This is, however, only the latest step in a long-brewing war of words and economic tension that began in 2018 during Donald Trump’s first administration, if not before. The current Trump administration's tariff policies are strategically targeted, not only trapping export-focused Chinese enterprises in a dilemma but also intensifying the urgency for China to upgrade its industrial capabilities and self-reliance.
In this article, Lu Jiangning (CEIBS GEMBA 2007), Chairman of Bright Show International Ltd. and a former Ministry of Commerce official posted overseas, provides a detailed analysis of the impact of US tariff increases and the adaptive strategies that Chinese enterprises may adopt.