A few days ago, Trump had a meeting with Jean Claude Juncker and may have resolved our trade issues with the EU.
Now China is beginning to buckle under US pressure as it slowly dawns among the Communist Party that Trump is actually very serious about trade reform:
Over the weekend, Trump claimed on Twitter that the US is winning the trade war with China for one simple reason: whereas US stocks are back to all time highs, the Chinese market has tumbled and remains mired in a bear market. Now, another – less naive – indication has emerged suggesting that the US is indeed getting the upper hand in the ongoing trade feud: according to Reuters, the trade war with the United States is “causing rifts” within China’s Communist Party, with some critics saying that China’s overly nationalistic stance “may have hardened the U.S. position.”
While China’s President Xi still retains his undisputed grip on power, some have noted an unusual surge of criticism about economic policy and how the government has handled the trade war, revealing “rare cracks in the ruling Communist Party.” Specifically, Reuters notes that the backlash is being felt at the highest levels of the government, hitting a close aide to Xi, his ideology chief and strategist Wang Huning.
Wang, a prominent and influential academic, has recently also come under attack for his strident views on Chinese power: the architect of the “China Dream”, Xi’s vision for China to become a strong and prosperous nation, Wang has been taken to task by the Chinese leader for crafting an excessively nationalistic image for the country, which has only provoked the United States, the sources said.
Naturally, China did not respond to a Reuters request for comment on Wang and his relationship with Xi, or on whether China had erred in its messaging in the trade war. But, in a stark confirmation that the ongoing trade war with the US is taking its toll, there is a growing feeling within the Chinese government that the outlook for China has “become grim”, according to a government policy advisor, following the deterioration in relations between China and the United States over trade.
Other influential policy makers have echoed the sentiment:
“Many economists and intellectuals are upset about China’s trade war policies,” an academic at a Chinese policy think tank told Reuters, speaking on condition of anonymity due to the sensitivity of the issue. “The overarching view is that China’s current stance has been too hard-line and the leadership has clearly misjudged the situation.”