Increasing tariffs on Chinese goods harm key exports

In 2017 (before the trade war), exports made up 18.5% of China’s GDP.^[1] Of those exports, more goods go to the United States than to any other country; however, the trade war caused a more than 12% decrease in China’s exports to the U.S. in 2019.^[2] That is a substantial blow to China’s economy. A large proportion of Chinese businesses have found that their goods are more expensive, uncompetitive, and languishing on U.S. shelves. This decrease in sales for businesses translates into a slowdown for the Chinese economy which has a tangible impact on Chinese workers and business owners. In 2019, China's industrial output growth fell to its lowest in 17 years.^[2] This is particularly damaging given the significant role export goods play in reducing poverty levels. Another source of prolonged damage to China is the possibility that this trade war results in further decoupling (reducing the United States’ reliance on China for manufacturing).^[3] Some manufacturing has already been moved, but more extensive decoupling would cause damage to China’s economy for years to come. With total tariffs placed on Chinese goods reaching $550 billion, it is safe to say that President Trump's tariffs have made a big impact on the Chinese economy.^[4] What's more, because of China's economic reliance on export-led growth, they are less able to sustain the prolonged damage of U.S. sanctions and will lose the trade war.

[P1] China is reliant on U.S. exports to maintain its level of growth. [P2] Targeting those exports through large tariffs will cause huge damage to the Chinese economy. [P3] The U.S. will be able to sustain the damage for longer than China, which means a loss of the trade war for China and a capitulation to U.S. demands.