Who benefits most from a US China trade war?

While the US-China trade war generally hurt both economies, certain third-party countries (like Vietnam, Mexico, Taiwan, Thailand) benefited significantly by capturing displaced Chinese exports, along with specific US companies (especially government contractors) that secured tariff exemptions. The primary beneficiaries were those who could rapidly shift production to substitute goods or navigate the complex tariff system, shifting supply chains away from China.

What countries benefited from the US-China trade war?

Export growth in targeted products varied significantly across countries, with countries like Vietnam, Thailand, Korea, and Mexico emerging as major beneficiaries.

Who will benefit from the trade war?

Skilled workers in the exporting sector, however, lose in the long run and lose even more so in the short run. The workers who benefit most from an increase in tariffs are the unskilled workers in the import-competing sector.

What are the benefits of US trade with China?

That means that the US imported $262.2 billion more from China than we exported to it. Benefits of trade can include higher wages and job growth, a wider variety of products available at lower prices, increased productivity, and more efficient resource allocation.

What is the main reason for the US China trade war?

The U.S.-China trade war, ignited in 2018, stemmed from U.S. concerns over China's massive trade surplus, alleged unfair practices like intellectual property theft, forced technology transfers, and state-backed economic distortions that hurt American jobs and competitiveness, leading to U.S. tariffs aimed at forcing policy changes, while China retaliated, escalating into broader disputes over technology, market access, and national security. 

US-China trade war 2025: Trump’s tariffs, rare earth metals and a fragile truce

Why did Donald Trump start the trade war?

Trump has said the tariffs are intended to reduce the U.S.'s trade deficit with Canada and Mexico, force both countries to secure their borders with the U.S. against illegal immigration and fentanyl smuggling, and promote domestic manufacturing in the United States.

Did Biden remove Trump's tariffs?

The Biden administration did not withdraw Trump-era tariffs on Chinese imports and this rate remained steady throughout Biden's term.

Who is the #1 exporter to the US?

Right now, Mexico is the biggest exporter to the US for the first time in 20 years. The latest figures from the US Department of Commerce show that it overtook China in 2023.

How much does China owe the USA?

China holds a significant amount of U.S. debt, primarily in Treasury bonds, with recent figures (late 2024/early 2025) showing China owning around $750-$800 billion in U.S. securities, making it the second-largest foreign holder after Japan, though this is a smaller percentage of the total U.S. debt. This amount fluctuates as China has been reducing its holdings, but it represents loans from China to the U.S. government, not a debt the U.S. owes to China in a punitive way, but rather investments in U.S. assets. 

Who is China's #1 trading partner?

China's biggest trading partner varies slightly by data source and whether it's total trade, exports, or imports, but recent data consistently shows the United States and the ASEAN bloc (Association of Southeast Asian Nations) as its largest overall partners, with the EU also a major force, while the US is often its top single country destination for exports despite recent shifts. ASEAN surpassed the US as China's key export market in 2023 due to increased regional integration and tensions with the US. 

Are Trump's tariffs hurting the economy?

The Trump tariffs are the largest US tax increase as a percent of GDP (0.47 percent for 2025) since 1993. Trump's imposed tariffs will raise $2.1 trillion in revenue over the next decade on a conventional basis and reduce US GDP by 0.5 percent, all before foreign retaliation.

What companies will benefit from the trade war?

"Tech companies, particularly those reliant on Chinese manufacturing and markets, are seeing positive impacts from the tariff reductions," Hempel says. "On the technology side, Amazon experienced a 7.4% surge, outperforming other major tech stocks, due to its reliance on Chinese goods and advertisers."

Do trade wars benefit anyone?

Trade wars are a side effect of protectionist policies and are controversial. Advocates say trade wars protect national interests and provide advantages to domestic businesses. Critics of trade wars claim that they ultimately hurt local companies, consumers, and the economy.

How does Mexico benefit from US-China trade war?

Figure 1 shows a striking pattern based on aggregate data. As the US import share from China declined following the imposition of tariffs in 2018/19, the import share from Mexico rose. This suggests that Mexico was able to fill part of the gap left by reduced Chinese exports to the United States.

What is the #1 export that the US sends to China?

Growth in US exports to other top foreign markets in 2022 far outpaced growth in exports to China. Oilseeds and grains—crops like soybeans, wheat, and corn—remained the largest export to China by far. At $25.4 billion, these exports totaled more than twice the size of the next largest category.

What are the cons of trade war?

Trade wars primarily hurt consumers with higher prices, harm businesses through increased costs and disrupted supply chains, slow economic growth and job creation, and damage international relations, leading to less global trade, reduced competitiveness, and economic pain for both initiating and targeted countries, as seen in the US-China example. 

Who owns over 70% of the US debt?

Who owns the most U.S. debt? Around 70-80 percent of U.S. debt is held by domestic financial actors and institutions in the United States. U.S. Treasuries represent a convenient, liquid, low-risk store of value.

Who owns most of China's debt?

Most of China's debt is held domestically by state-owned banks, local government financing vehicles (LGFVs), insurance companies, and domestic institutional investors, with foreign ownership being relatively small despite recent growth, while China also lends heavily to other nations through Belt and Road Initiative (BRI) projects. The debt structure is unique, relying heavily on internal financing from state-backed entities and households, especially for infrastructure, rather than broad foreign holdings. 

Who owes US the most money?

The U.S. owes the most money to itself (domestic holders like U.S. investors, banks, and government trust funds), but among foreign countries, Japan holds the largest share of U.S. debt, followed by China and the United Kingdom, with Japan surpassing China as the top foreign holder around 2019. A significant portion of U.S. debt is also held by the Federal Reserve and other government entities (intragovernmental debt). 

Has Trump reduced the trade deficit?

The trade deficit has narrowed to its smallest since mid-2020, down more than 35% over last year — and more proof that President Donald J. Trump's America First trade agenda is working.

Is blood 2% of U.S. exports?

The Census Bureau estimates that 2.69% of American exports are blood. Human blood cannot be substituted, hence there is sometimes a shortage. The Red Cross declared its first-ever nationwide blood shortage crisis during the COVID outbreak.

What is the U.S.'s most profitable export?

The following are the United States' top exports by value:

• Civilian Aircraft Parts.
• Oil.
• Gasoline and Other Fuels.
• Low-Value Shipments.
• Liquified Natural Gas (LNG) and Other Petroleum Gases.

How did Donald Trump change the economy?

Despite saying during the 2016 campaign he would eliminate the national debt in eight years, Trump as president approved large increases in government spending, as well as the 2017 tax cut. As a result, the federal budget deficit increased by almost 50%, to nearly $1 trillion (~$1.21 trillion in 2024) in 2019.

What president is famous for tariffs?

The Tariff Act of 1890, commonly called the McKinley Tariff, was an act of the United States Congress framed by then-Representative William McKinley, that became law on October 1, 1890.

What is Donald Trump's net worth?

Donald Trump's net worth fluctuates but was estimated around $5.1 billion by Forbes in mid-2025, though other estimates vary, with Bloomberg showing $7.08 billion in early 2025. Key drivers for recent changes include gains from his social media company (Truth Social), digital tokens, and real estate, alongside traditional assets like golf courses and hotels, with his fortune impacted by market shifts and ventures.