How Trump’s 2024 Election Victory Reshaped U.S.-China Economic Ties
With Donald Trump’s return to the White House in 2025, the already fractured Chimerica model faces further disintegration. His aggressive trade policies and “America First” agenda have accelerated the decoupling of the world’s two largest economies, with global repercussions.
1. Trump’s 2025 Trade War 2.0: Escalating the Split
Key Actions Taken (2025)
✅ 60% Tariffs on Chinese EVs & Tech – A drastic hike from previous rates, effectively blocking BYD, Xiaomi, and Huawei from U.S. markets.
✅ Ban on Chinese Cloud Computing Firms – Restrictions on Alibaba Cloud & Tencent over “data security risks.”
✅ Forced Divestment of TikTok – ByteDance given 90 days to sell or face a U.S. ban.
Impact:
- China retaliates with rare earth export controls, disrupting U.S. semiconductor and defense manufacturing.
- Apple & Tesla face backlash in China, with sales dropping 20% after nationalist boycotts.
2. Financial Decoupling: The End of Dollar Recycling?
- China Dumps U.S. Treasuries – Beijing accelerates diversification into gold, euros, and BRICS currencies.
- Yuan Digital Push – The e-CNY (digital yuan) gains traction in Africa and Latin America, challenging dollar dominance.
- Wall Street Retreats – U.S. investors pull $50B+ from Chinese markets amid regulatory crackdowns.
Quote: “The era of China funding U.S. deficits is over.” – Larry Summers, 2025
3. Supply Chains: “America First” vs. “China’s Self-Reliance”
- U.S. Reshoring Boom – TSMC’s Arizona fabs go live, while Ford shifts EV battery production from China to Michigan.
- China’s “Dual Circulation” Deepens – Huawei’s 3nm breakthrough (despite sanctions) signals tech independence.
- ASEAN Wins – Vietnam and India absorb $200B+ in redirected factory investments.
Data Point: U.S.-China trade drops to **400Bin2025∗∗(downfrom400Bin2025∗∗(downfrom690B in 2022).
4. Military-Industrial Decoupling
- U.S. Blocks Chinese Rare Earths for F-35s – Turns to Australia & Canada for supplies.
- China Bans Boeing – Orders 1,000+ COMAC jets for domestic airlines.
Flashpoint: Taiwan Strait tensions spike after Trump’s arms sale pledge to Taipei.
5. Is There Any Hope for Cooperation?
Only in Climate Tech (Reluctantly)
- U.S.-China Green Energy Pact – Limited collaboration on carbon capture and fusion energy R&D.
- But… Solar panel tariffs remain at 50%, stifling global decarbonization.
The Bottom Line
Trump’s second term has killed Chimerica for good, replacing it with:
🔹 A Bipolar Tech Economy (U.S. AI vs. Chinese semiconductors)
🔹 Parallel Financial Systems (Dollar vs. Yuan bloc)
🔹 A New Cold War Playbook (Trade wars + Military brinksmanship)
“The 2020s will be remembered as the decade globalization shattered—and Chimerica was Patient Zero.”
(Sources: U.S. Treasury, SCMP, Bloomberg, BRICS 2025 Summit)