Can Trump’s Tariffs Really Stop China’s Rise?

Picture Credit: Axios

Donald Trump’s aggressive trade policies, particularly tariffs on Chinese goods, are aimed at slowing China’s economic and technological ascent. However, history suggests that while such measures may create obstacles, they are unlikely to derail China’s long-term trajectory as a global leader in innovation.

Despite years of trade restrictions and sanctions, China has cemented itself as a major player across multiple high-tech industries. Chinese firms now lead in areas such as artificial intelligence (AI), electric vehicles (EVs), batteries, solar panels, and quantum computing. The recent rise of DeepSeek AI, which has challenged U.S. tech giants at a fraction of the cost, highlights China’s growing capacity for homegrown innovation.

China has also overtaken the U.S. in global car sales, thanks to industry leaders like BYD, and controls 80-95% of the global solar panel supply chain. In emerging fields like quantum computing, Chinese researchers publish more papers annually than their American counterparts, demonstrating scientific leadership.

A key driver of China’s rise is its long-term industrial policy. The “Made in China 2025” initiative, launched in 2015, aimed to transition the country from a low-cost manufacturing hub to a global leader in advanced technology. By 2020, China had spent over $627 billion in grants, research funding, and strategic acquisitions to strengthen its capabilities in AI, semiconductors, and 5G.

The Chinese government has also actively supported domestic companies, fostering state-backed capitalism to accelerate progress. Foreign companies entering China are often required to form joint ventures with local firms, allowing knowledge transfer and strengthening local industries.

The U.S. has responded by imposing sanctions on Chinese companies and restricting China’s access to advanced semiconductors. The Trump administration’s tariffs were designed to make Chinese goods less competitive globally, while sanctions targeted major firms like Huawei, crippling its access to cutting-edge chips. However, China adapted. Huawei, once written off due to U.S. bans, pivoted into chip manufacturing and recently launched a smartphone with advanced semiconductors—a breakthrough that shocked U.S. policymakers.

Similarly, DeepSeek AI developed a high-performing chatbot without access to the latest Nvidia chips, proving that China can innovate under pressure. This resilience challenges the effectiveness of tariffs and technology bans as tools to contain China’s growth.

While China has made enormous progress, it still lags behind in some areas, particularly in semiconductor manufacturing, where the U.S. remains dominant. The Biden administration has doubled down on reshoring chip production, with $500 billion in AI and semiconductor investments announced in early 2025. Germany, Japan, and other allies are also launching counterstrategies to maintain their technological edge.

Yet, China’s deep pockets, patient policies, and ability to adapt to restrictions mean that it is unlikely to be stopped by tariffs alone. Instead of slowing China’s rise, the trade war may accelerate its push for self-sufficiency, further fueling competition in the global tech race.

Trump’s tariffs may create short-term challenges, but history suggests that China will find a way to innovate, pivot, and continue its ascent as a technology powerhouse.