THINKING ABOUT CHINA AND THE TRUMP TARIFF SHOCK The return of Donald Trump to the White House has led to a marked escalation in Sino-American trade tensions. On April 2 nd , the so-called “Liberation Day,” Trump imposed a 145% tariff on Chinese goods, which amounted to a trade embargo on China. While the President reversed course following backlash from financial markets and concerns over empty shelves in retail outlets, effective duties on Chinese imports remain punishingly high, at 30-50%. These rates could become even steeper if the US and China fail to make a new trade deal during the 90-day pause on the April 2 nd tariffs announced on May 12 th . A lot of ink has already been spilled on which country will come out on top in this dispute. Following the May 12 th tariff reversal, most of this commentary has argued that Xi Jinping has gained the upper hand, pointing to Trump’s ham-fisted conduct of trade negotiations with China (and most...