A second Trump administration's foreign policy is expected to be highly personalized and transactional, operating like a 'palace court' where decisions are driven by the president's personal relationships and core domestic priorities like re-industrialization. This approach marks a significant departure from traditional, institutionalized foreign policy, creating a highly unpredictable international environment.
Having experienced one Trump term, China is no longer caught off-guard and is better prepared for a potential return. Beijing's strategy involves weathering U.S. pressure while using it as a catalyst to accelerate domestic goals, particularly achieving technological self-sufficiency and upgrading its industrial base to reduce reliance on foreign technology.
Under a potential Trump administration, Europe increasingly views the United States as an unreliable security partner and an economic adversary. China is attempting to capitalize on this rift by positioning itself as a force for stability and recognizing Europe as a distinct pole of global power, though its tacit support for Russia in the Ukraine conflict remains a major obstacle to a deeper rapprochement.
The technological rivalry, centered on advanced semiconductors, is set to escalate significantly. The U.S. is expected to tighten and expand export controls to stifle China's tech progress, while China responds with massive state investment, such as a new one trillion yuan venture capital fund, to build a self-reliant domestic chip industry.
The discussion highlights the risk of a 'Kindleberger Trap,' where a retreating incumbent power (the U.S.) is no longer willing or able to provide global public goods, and the rising power (China) is not yet prepared or capable of filling the void. This creates a dangerous period of global instability, as the international system lacks a clear stabilizing force.
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