While the president-elect has not yet officially taken office, tensions between Washington and Beijing are already escalating on the trade front. Both sides are ramping up announcements and measures, signaling a complete lack of respite in their economic confrontation.

Donald Trump’s re-election has ushered in a transitional period in the United States, but this context has not stopped the leader from reiterating his campaign promise: to impose an additional 10% tariff on Chinese imports at the very start of his term. Trump, who had also mentioned the possibility of tariffs as high as 60%, has recently expanded his target to include BRICS countries, of which China is a member.

For several years, Sino-American relations have evolved into a strategic confrontation where international trade serves as the main battleground. Trump’s protectionist measures, introduced during his first term, were strengthened by his administration and extended by the current one, particularly in the technology sector. The issue of semiconductors, in particular, highlights how this economic rivalry has taken on a global dimension, affecting both supply chains and geopolitical dynamics.

A Gradual Escalation of Tensions

Well before Donald Trump’s inauguration, trade relations between the United States and China were already marked by mutual distrust. During his presidential campaign, Trump pledged to impose massive tariffs on Chinese goods to rebalance the trade deficit. Once elected, he implemented this strategy through a series of tariff and non-tariff barriers. In response, Beijing stepped up efforts to reduce its dependence on American technologies while adopting similar measures against U.S. companies.

Last November, a new milestone was reached in this economic confrontation. Washington expanded its restrictions on semiconductor exports and added 140 Chinese companies to its blacklist. According to the U.S. Department of Commerce, the goal of these sanctions is to curb China’s technological advancements in strategic sectors, particularly the military industry.

China’s Response: Control of Critical Materials

In response, China has decided to strictly regulate the export of materials essential for semiconductor manufacturing, such as gallium and germanium. These metals, crucial in various fields like solar panels and infrared systems, are now subject to restrictive export licenses and, in some cases related to defense, outright bans.

Officially, Beijing justifies these measures as necessary for national security. However, many view them as a direct response to U.S. initiatives. With a dominant position in global production—94% of gallium and 83% of germanium—China wields a powerful lever to counteract in this trade war.

The reciprocal sanctions are already disrupting international supply chains. Experts warn that these restrictions could lead to price increases and delays in the delivery of components, particularly impacting the technology and electric vehicle industries. Manufacturers, faced with these challenges, are actively exploring alternative solutions to secure their supplies.

Meanwhile, in China, authorities are promoting a strategy to replace American technologies. The Internet Society of China recently urged companies to prioritize locally produced chips or those developed in collaboration with other international partners. Industry associations, such as the one representing automakers, have also criticized the unilateral changes in U.S. export control regulations.

As Sino-American tensions focus on critical sectors, they reflect a much broader competition for global economic and technological leadership. This rivalry, which is shaping industrial and trade policies, will continue to have profound implications for international trade and the stability of supply chains.