U.S. Reportedly Planning to Isolate China on Trade Negotiations with 70 Countries

The United States is reportedly planning to use trade negotiations with over 70 countries to isolate China economically by pressuring these nations to limit their trade interactions with Beijing. The strategy involves requesting that these countries block Chinese goods from being routed through their territories, prevent Chinese firms from establishing operations within their borders to evade U.S. tariffs, and avoid absorbing cheap Chinese industrial goods into their economies.

This approach aims to weaken China’s global trade influence and force Beijing to negotiate with the U.S. under less favorable terms. The plan, attributed to Treasury Secretary Scott Bessent, is part of a broader escalation of the U.S.-China trade war, with the U.S. imposing 145% tariffs on Chinese imports while offering tariff reductions to other nations in exchange for compliance. Discussions with some countries have reportedly begun, though specific nations involved remain undisclosed.

China is countering by strengthening trade ties elsewhere, with Xi Jinping signing 45 deals with Vietnam and pushing for closer cooperation with the EU, Japan, and South Korea. Beijing has also appointed a new trade negotiator, Li Chenggang, amid stalled talks with Washington, signaling a strategic shift to navigate the escalating tensions.

The effectiveness of the U.S. strategy is uncertain. Some analysts argue that China’s defiance and domestic support for retaliation may limit the impact of these measures, while others note that nations may hesitate to fully align with the U.S. due to their economic reliance on China. The situation risks further decoupling the U.S. and Chinese economies, potentially disrupting global trade and raising costs for consumers.

Restricting trade routes and access to markets could strain China’s export-driven economy, reducing its global market share. Higher U.S. tariffs 145% on Chinese imports may force Chinese firms to seek alternative markets, potentially flooding other economies with cheap goods, which could destabilize local industries. Higher tariffs and trade restrictions may increase domestic consumer prices due to reduced access to low-cost Chinese goods. U.S. industries reliant on Chinese inputs could face supply chain disruptions and higher production costs.

Nations pressured to limit trade with China may face economic dilemmas. Aligning with the U.S. could secure tariff reductions, but cutting ties with China risks losing access to a major trading partner. Smaller economies dependent on both powers may struggle to balance these pressures. This escalation intensifies the U.S.-China trade war, potentially spilling into other domains like technology, military posturing, or influence in international organizations. It may further erode diplomatic relations, making cooperation on global issues (e.g., climate change) more difficult.

The U.S. strategy could reshape alliances, with countries forced to choose sides. Nations like Vietnam, India, or EU members may resist full alignment with the U.S. to maintain strategic autonomy, while others may leverage U.S. incentives to gain economic advantages. China’s push for stronger ties with Vietnam, the EU, Japan, and South Korea signals a counter-strategy to build a coalition resistant to U.S. pressure. This could strengthen China’s influence in Asia and beyond, potentially creating rival trade blocs.

Blocking Chinese goods from third-country routes may force a reorganization of global supply chains, increasing costs and delays. Industries like electronics, automotive, and textiles, heavily reliant on Chinese manufacturing, could face significant disruptions. The strategy risks further decoupling the U.S. and Chinese economies, fragmenting global trade into competing spheres. This could weaken multilateral trade frameworks like the WTO, as countries navigate bilateral or regional agreements instead.

Reduced trade efficiency and higher tariffs may lead to increased prices for goods worldwide, contributing to inflation and reducing purchasing power, particularly in import-dependent economies. Many countries may resist U.S. demands due to economic dependence on China or fear of retaliation from Beijing. Partial compliance could undermine the strategy’s effectiveness.

China’s domestic market and growing trade partnerships (e.g., Belt and Road Initiative) may mitigate the impact of U.S. restrictions, allowing Beijing to withstand economic isolation efforts. Smaller economies caught in the crossfire may face trade losses or political instability if forced to alienate one superpower. Global economic growth could slow if trade tensions escalate further.

While the U.S. aims to weaken China’s trade dominance, the strategy risks escalating global economic and geopolitical tensions, disrupting supply chains, and creating a fragmented trade landscape. The outcome hinges on the willingness of other nations to align with U.S. demands and China’s ability to counter through alternative partnerships.