Bracing for the US-China trade war to come

China’s announcement of export controls on 28 US companies, including defense giants Lockheed Martin and Boeing Defense, signals an ominous start to 2025.

This latest trade war salvo in the US-China rivalry comes just as Donald Trump prepares to resume the presidency, reigniting speculation that tit-for-tat trade policies will define the global economic landscape this year and possibly beyond.

The punitive move, ostensibly made to “safeguard national security and interests,” underscores Beijing’s growing willingness to retaliate against perceived US provocations, including the ramped-up restrictions imposed on China’s access to US and its allies’ chips and high-tech.

The timing suggests it’s not a coincidence. Trump’s campaign rhetoric repeatedly promised a tougher stance on China, including blanket 60% tariffs on China-made goods, greater scrutiny of Chinese investments and a doubling down on sanctions.

For China, the preemptive export controls send a message it is ready to fight US trade fire with fire. If Trump’s previous presidency taught us anything, it’s that his administration views trade policy as a zero-sum game.

The tariffs and trade barriers imposed during his first term sent shockwaves through global supply chains, but they also prompted China to escalate its countermeasures. By 2019, both nations were locked in a tit-for-tat trade war that left industries reeling and investors uncertain.

Fast forward to 2025, the dynamics have shifted but not eased. The global economy is already grappling with inflationary pressures, energy insecurity and the specter of war. A renewed escalation in trade tensions between the world’s two largest economies could exacerbate these challenges, dragging other nations into the