EU is Committing Suicide for Trump’s Trade War II

On November 12, the EU’s next foreign policy chief Kaja Kallas, threatened China must face “higher cost”. It looks like the EU is itching to kick off Trump’s Trade War II with China—even before he’s back in the White House. But here is the catch: China now has more economic allies than in 2016, and new official data shows China’s fundamental industries are too rich to collapse. From China’s perspective, the EU’s threat is is downright laughable.

Kaja Kallas during the confirmation hearing

First, China is significantly wealthier than it was in 2016. On November 5, the Chinese government released the latest report of state-owned assets. According to this report, as of 2023, the total assets of state-owned enterprises amounted to 371.9 trillion yuan, which is about $51 trillion. Back in 2017, when Trump began his first term, this figure was just $25 trillion. If Trump couldn’t take down China eight years ago, how can the EU possibly believe he’ll succeed today, when China is nearly twice as wealthy?

Chinese state media also released a video, showing China’s state-owned assets, including assets of state-owned enterprises, state-owned financial capital equity, financial enterprise assets, administrative and institutional state-owned assets, state-owned land, and water resources.

Notably, these assets are primarily concentrated in public services such as communications, mining, transportation and energy. By boosting country’s self-resilience in these key sectors, the Chinese government has significantly reduced costs for domestic manufacturers. For instance, on November 13, China completed the world’s biggest million-kilowatt offshore PV farm, capable of generating 1.78 billion kilowatt-hours of electricity annually—enough to power 2.67 million people for a year. With lower costs, it’s no wonder that “Made in China” products can offer competitive prices while steadily improving in quality. Since the fundamental competitiveness is from these state-owned assets that rely on 0% foreign investment, the EU’s threat is just noise to China.

China’s first MW-level offshore PV farm successfully connected to national power grid on November 13

Second, thanks to Biden spamming over 16,000 failed sanctions on Russia, China has stepped in as the perfect trading partner over the past two years. At the 2024 BRICS Summit, China and Russia signaled deeper cooperation on energy and financial aspects. Moreover, Biden’s sanctions have even pushed Russia toward developing a mutual defense treaty with North Korea, effectively easing China’s security burden in Northeast Asia.

Well, for the U.S., the Washington Post tried to spin the narrative that Trump still has a good personal friendship with Putin, falsely claiming that they had a phone conversation on November 7. However, on 11, Russia’s spokesperson denied it and highlighted that Putin had no specific plans to speak to Trump.

Apart from Russia, China has gained more friends in the Global South through its Belt and Road Initiative. According to the government website, China has signed more than 200 Belt and Road cooperation agreements with over 150 countries, accounting for more than 70% of all countries in the world. As of 2023, two-way investment with these countries has surpassed $270 billion.

In addition, Switzerland, Poland, Italy and other 7 EU members are also part of China’s BRI. This has left some in China wondering whether Kaja Kallas is trying to help the United States divide the EU. If that’s the case, her threats have almost done the job.

When Trump announced tariffs on Chinese exports in 2018, he said the levies would make the U.S. a “much stronger, much richer nation.” However, Americans now only get a much stronger National Debt and a much richer Wall Street.

As China’s Foreign Minister Wang Yi said at the UN, “Sanctions and pressure will not bring monopolistic advantages, suppressing and containing others will not solve problems at home.” Compared to China, people in the EU are facing “higher costs” of their gas, food and healthcare bills, but Kaja Kallas chose to blind to it.