As the US-China trade war escalated – with US President Donald Trump reportedly pressuring other countries to curb trade with China in exchange for tariff exemptions – Beijing issued a forceful warning: those who bow to US pressure will face consequences. While maintaining a hard-nosed position, China has not escaped unscathed. In the first quarter of 2025, the consumer price index – a measure of downstream demand – fell by 0.1 per cent year on year, while the producer price index – tracking midstream and upstream production – declined 2.3 per cent. Both indicators fell short of annual targets. Trump’s strategy rests on the assumption that China’s trade surplus with the United States makes it inherently vulnerable – and that tariffs could compel Beijing to show deference and renegotiate terms on his terms. China’s trade surplus is rooted in its vast industrial production. Since 2001, its share of global value-added manufacturing has soared from 6 per cent to nearly 30 per cent, while the US’ share has declined from 28 per cent to 17 per cent. Without access to the US market, China faces a genuine vulnerability – one that would intensify if key trading partners align with Washington. So why does Beijing remain unfazed? What fuels its confidence that it can endure decoupling and a prolonged trade war? China cannot easily replace lost export markets, just as tariffs alone cannot revive American manufacturing overnight. As the trade war grinds on and bilateral trade nears zero, the real question is no longer who can escalate further – but who can endure longer. On Tuesday, China’s Foreign Ministry posted a video on social media hitting out at the US’ trade practices, declaring it would not “kneel down”. This marked a clear departure from its earlier muted, carefully calibrated posture – denying that talks were under way. While Beijing is likely to have welcomed Trump’s suspension of “reciprocal” tariffs on most countries – although not China – as a sign of US vulnerability, its firm stance reinforced a narrative of strength, patience and stability, signalling to domestic and global audiences that US pressure tactics would yield limited results. Several hard facts bolster Beijing’s confidence. China is the world’s second-largest consumer market and expected to replace the US as the world’s largest by 2030. In sectors such as automobiles, smartphones and industrial goods like chips, steel, cement and electricity, China now leads globally. At a Politburo meeting on April 25, the government pledged to stabilise employment, businesses, markets and expectations, by “focusing on handling [China’s] own affairs” to counteract external uncertainties. Meanwhile, the US remains deeply embedded in supply chains dominated by China, including through countries like Vietnam, which rely heavily on Chinese intermediate goods and infrastructure such as electricity and logistics. In 2024, 86 per cent of gaming consoles and 73 per cent of smartphones imported by the US came from China. Many hi-tech electronics were excluded from Trump’s “reciprocal” tariffs to avoid a consumer backlash – a telling sign of US continued dependence on Chinese manufacturing. In the long run, US-China rivalry is not merely economic; it is a clash of cultures – of the soft foundations that underpin each society. China’s governance is anchored in a collective ethos shaped by Confucian traditions and a centralised political system. National security forms the foundation, but development sets the ceiling. Development is more than a policy goal; it underpins the legitimacy of the Communist Party and fuels Beijing’s strategic confidence. President Xi Jinping has spelled out China’s “four red lines” for any bilateral relationship, explicitly framing the right to development as a core concern. Resisting US pressure, in Beijing’s view, is about defending that right – and asserting China’s leadership against unilateral bullying. Politically, Xi’s authority rests on the party’s ability to safeguard sovereignty and deliver prosperity. He is free to pursue long-term strategies, an approach in line with China’s collectivist values, long-term thinking and hierarchical structure, all rooted in its Confucian heritage. Historically, external enemies – real or perceived – tend to rally public unity. Memories of past humiliation feed a narrative of resistance, casting the trade war as a test of national resolve. By portraying the US as a coercive adversary, Beijing fuses nationalism with political loyalty, reinforcing the party’s legitimacy, as many Chinese now view the US as a clear external threat. Diplomatically, China is also adapting. Its former “partnership, not alliances” doctrine is evolving into a more structured approach. Strategic partnerships are being extended to countries like Russia, Pakistan and several Central Asian nations. Meanwhile, Beijing is forming issue-specific relationships with European Union states around green technology and infrastructure. Xi’s recent visit to Southeast Asian countries and possible meetings with European leaders in July reflect this more assertive, differentiated outreach. This recalibration is driven by two pressures. First, the Global South increasingly expects tangible public goods, such as development financing, Brics Plus cooperation and renminbi swap lines. Second, sustained US pressure has made diplomatic ambiguity harder to sustain. Beijing must strike a balance between avoiding a unified anti-China front and providing enough clarity to reassure partners in an increasingly polarised world. So far, time appears to be on Xi’s side in the prolonged US-China stand-off. While short-term shocks persist, China’s long game positions it to withstand external pressure and shape the rules of engagement on its own terms. For most countries involved in this trade war, the wisest course, for now, is to avoid taking sides and observe how the long game unfolds – with patience.