HOW CHINA PREPPED FOR THE TARIFF CRISIS

Chinese goods exports grew by 4.1% in year-on-year terms in August. It was the slowest rate in six months, and its worst performance since the US' Donald Trump administration imposed tariffs on almost all economies.

- BY DEEPA VASUDEVAN

Exports to the US dropped by as much as 33%. It was partly the result of front-loading of shipments earlier this year, but also because export orders have been put on hold while both sides await clarity on the evolving tariff situation.

Does this mean that the Chinese export juggernaut has been halted? Well, not really.

In fact, exports from China appear to be remarkably resilient even in the face of trade tensions. China has been preparing for a trade shock since tariffs were first imposed in 2018, during the previous Trump presidency. By the time Trump rolled out his new tariffs plan again in 2025, Chinese authorities had already taken steps to mitigate the risk they faced from relying so heavily on exports.

FIND NEW MARKETS

China's core strategy was to reduce reliance on the US by diversifying into new export markets. Since 2018, the US share in China's exports has declined by nearly 8 percentage points. This was mostly set off by the increase in export shares of members of the Association of Southeast Asian Nations (Asean), and Latin American and African nations.

In Africa, China has established deep trade links by riding on the Belt and Road Initiative (all except one African nation has signed up for it in some form). The BRI modus operandi is as follows: China lends money to poorer nations for developing infrastructure and industrial zones. Chinese firms carry out the task of building projects and maintaining them.