Xi urges officials to stay calm as US raises pressure on China
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Chinese President Xi Jinping's comments coincide with his US counterpart Donald Trump taking his most sweeping actions yet against China in his second term.
PHOTO: REUTERS
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BEIJING – Chinese President Xi Jinping urged officials to stay composed amid domestic and global challenges, signalling Beijing will take a measured approach to the Trump administration’s new trade and investment restrictions.
China “must enhance its political capabilities and calmly respond to challenges brought about by changes in the domestic and international situation”, Mr Xi told top officials, including Politburo and State Council party members, according to the official Xinhua News Agency report on Feb 26.
His comments coincide with US President Donald Trump taking his most sweeping actions yet against China
Washington has ramped up pressure by restricting Chinese spending in US strategic sectors such as tech and energy, urging Mexico to impose its own tariffs on Chinese imports and pushing for fees on commercial ships made in China to counter its dominance in shipbuilding.
The White House is also working on tougher semiconductor restrictions and urging key allies to escalate their own limits on China’s chip industry, aiming to curb Beijing’s tech advancements, Bloomberg News reported.
Rising tensions have already rattled global investors and dragged down Chinese stocks.
“America has, in my opinion, been itching for a fight with China – China hasn’t taken the bait,” Mr Peter Alexander, managing director of Shanghai-based consultancy Z-Ben Advisors, told Bloomberg TV on Feb 26. “But you know, there are sort of two realities that we’re heading towards. I’m hoping it’s the one where an agreement can be made.”
For now, both countries appear keen to maintain a delicate relationship.
Chinese Vice-Premier He Lifeng spoke to Treasury Secretary Scott Bessent on Feb 21 – the second high-level contact since Mr Trump took office – indicating ongoing communication.
Mr Trump has also highlighted his personal ties with Mr Xi and said last week that a new trade deal with China was possible
But as the pressure grew, China shifted its position, adopting a more assertive stance with a set of tactics known as “wolf warrior” diplomacy, which reflected Beijing’s growing frustration with Washington’s unpredictability.
Now, however, China seems more experienced and prepared.
Since Mr Trump’s 10 per cent tariff on Chinese goods took effect earlier in February, Beijing has responded quickly but carefully – targeting US products with tariffs designed to avoid major blowback on its own economy while signalling it has more ways to hit American companies if needed.
“We will resolutely respond to unilateral bullying practices of the US,” Chinese Foreign Minister Wang Yi said at the Munich Security Conference in February.
In his latest remarks, Mr Xi also called on top officials to maintain social stability, promote the sustained recovery of the economy and steadily improve people’s living standards.
China is trying to shake off a prolonged economic slowdown, with its strong exports facing growing pressure from trade tensions abroad.
In 2024, a series of violent public attacks stirred concern among residents, who connected these incidents to increasing economic woes.
In February, the Chinese leader met top tech entrepreneurs in a bid to restore confidence in the private sector.
Economists expect the upcoming national Parliament meeting to introduce new measures to drive consumption.
Ms Marcella Chow, global market strategist at JPMorgan Asset Management, said: “We do still think a forceful policy stimulus is needed for the market to boost consumer confidence, to make it more sustainable.”
Speaking to Bloomberg TV on Feb 26, she warned that the recent rally in Chinese stocks raises the possibility that the government may become complacent about further action.
More stable and predictable US-China trade relations will also be a key catalyst for spurring further gains in the Chinese market, she added. BLOOMBERG
