Importance Score: 72 / 100 🔴
Xi Jinping Highlights No Winners in Trade War During Southeast Asia Tour
Chinese President Xi Jinping commenced a diplomatic tour of Southeast Asia on Monday, asserting that no nation gains from a trade war. His remarks, delivered as he began his visit, underscored China’s commitment to global commerce, especially when juxtaposed against the backdrop of recent tariff measures initiated by US President Donald Trump. The tour comes as trade tensions impacting major global economies remain a central issue.
Ongoing Tariffs Despite Partial Pause
While President Trump has temporarily suspended some tariffs, substantial duties, including 145% tariffs on Chinese products, remain implemented, affecting the world’s second-largest economy.
Call for Multilateral Trade System
“There are no winners in a trade war, or a tariff war,” Xi articulated in an editorial published in Vietnamese and Chinese state media outlets. He further urged that both nations should “resolutely safeguard the multilateral trading system, stable global industrial and supply chains, and an open and cooperative international environment.”
China’s Regional Influence Amid Trade Disputes
According to Nguyen Khac Giang, a visiting fellow at Singapore’s ISEAS–Yusof Ishak Institute, Xi’s visit serves to project China as a “responsible superpower,” presenting a contrast to the global perception of the US under President Donald Trump’s administration.
Xi was welcomed by Vietnam’s President Luong Cuong upon arrival, marking a high-level reception that is not routinely extended to visiting dignitaries, noted Nguyen Thanh Trung, a professor of Vietnamese studies at Fulbright University Vietnam.
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Symbolic Welcome Ceremony
Students from a drum art group performed during the arrival ceremony, while citizens waved both Chinese and Communist Party flags.
Strategic Timing of Southeast Asia Visit
Though likely planned previously, the significance of Xi’s tour has been amplified by the ongoing trade friction between China and the US. This visit provides an opportunity for Beijing to solidify alliances and explore avenues to mitigate the effects of elevated trade barriers imposed by the US on Chinese exports.
In Vietnam, Xi is scheduled to engage in discussions with Vietnam’s Communist Party General Secretary To Lam and Prime Minister Pham Minh Chinh.
Insulating Against Trade Pressures
Nguyen Khac Giang commented that the destinations of the tour – Vietnam, Malaysia, and Cambodia – indicate China’s strategy to “insulate itself against tariffs from Trump.” He highlighted that this is only Xi’s second visit to Vietnam since assuming the presidency in 2013.
Huong Le-Thu from the International Crisis Group think tank emphasized that the timing of the visit conveys a “strong political message” about the importance China ascribes to Southeast Asia.
She added that Southeast Asian countries are concerned about the potential impact of tariffs on their development, despite the current 90-day pause in tariff escalations.
Vietnam’s Balancing Act
Vietnam has demonstrated expertise in managing its relationships with both the US and China. While operating under a similar communist, one-party system as China, Vietnam has also cultivated strong ties with the US.
Notably, in 2023, Vietnam was unique in hosting both US President Joe Biden and China’s Xi Jinping.
That same year, Vietnam elevated its diplomatic relationship with the US to the highest level, aligning it with the status held by China and Russia.
Vietnam as a Supply Chain Hub
Vietnam has emerged as a key beneficiary of businesses diversifying their supply chains away from China, attracting companies seeking alternative manufacturing locations.
China remains Vietnam’s largest trading partner, with bilateral trade experiencing a substantial 14.6% increase year-over-year in 2024, according to Chinese state media.
Precarious Position Amid Trade Tensions
However, escalating trade disputes have placed Vietnam in a “very precarious situation,” especially given perceptions in the US that Vietnam could be serving as a conduit for Chinese goods circumventing tariffs, according to Giang.
Vietnam had previously faced 46% tariffs under Trump’s directives before the 90-day suspension.
Long-Term Differences Remain
Despite economic cooperation, China and Vietnam have enduring differences, notably including territorial disputes in the South China Sea. Vietnam has, at times, confronted China’s coast guard in these contested waters, although such incidents are often not publicly disclosed.
Further Stops in Southeast Asia
Following Vietnam, Xi Jinping is anticipated to proceed with visits to Malaysia and Cambodia, continuing his diplomatic engagement across Southeast Asia.