Trump’s tariff wars reshaped US-China trade – at what cost to American firms?

China would have bought nearly 60 per cent more goods from the United States in 2025 if not for US President Donald Trump’s trade wars, according to a former chief economist at the US State Department.That shortfall would have reached about US$90 billion for the year, wrote Chad Bown in an article published on Tuesday by the Peterson Institute for International Economics, where he is a senior fellow.His comments came as US goods exports to China declined sharply by 25.8 per cent in 2025 from a year earlier, largely because of the trade war that had pushed duties to levels verging on a de facto embargo before five rounds of high-level trade talks helped ease tensions.“Each time Trump raised tariffs – by 145 percentage points in early 2025, as well as during his first trade war of 2018–19 – China retaliated with matching tariff increases, accelerating the US export decline,” he wrote.While US shipments to China have fallen, the latter’s global exports have surged by more than 50 per cent over the past five years – culminating in a record US$1.19 trillion surplus in 2025. But imports from the rest of the world have grown far more slowly, an imbalance that has also strained relations with major European economies.Brussels has increasingly echoed US complaints about Beijing’s subsidies, industrial policies and preferential treatment for domestic firms and products, which are seen as fuelling excess capacity and weakening import demand.