Politburo Signals CCP’s Intent to Persist in Trade Conflict with US, Analysts Say, Regardless of Costs

April 29, 2025 TruthUSA

Analysts indicate that Beijing’s unwillingness to settle the impasse with Washington hampers its capacity to address domestic challenges.

News Analysis

On Friday, the leadership of the Chinese Communist Party (CCP) committed to stabilizing the nation’s economy amid rising external pressures. Experts believe that achieving this objective may be obstructed by Beijing’s inflexible position regarding U.S. tariffs.

In a recent closed-door gathering, the Politburo, the CCP’s second-highest leadership body, urged officials to “integrate domestic economic efforts with international trade conflicts,” as per the official summary.

Under the chairmanship of Party chief Xi Jinping, the leaders also promised during the meeting to roll out new “structural monetary policy tools” along with financial measures to promote technical innovation, enhance consumption, and stabilize foreign investments, without providing further details.

The Politburo’s 24 senior leaders generally meet at the end of April to deliberate economic issues. Although the meeting resulted in a brief, technical statement, it provides significant insights into Beijing’s economic priorities, making it a point of interest for investors and analysts.

“This Politburo meeting carries significant weight; it’s where vital decisions are made,” stated Wang He, a commentator on China affairs based in the U.S. and a former university lecturer in China, to The Epoch Times.

As the triple-digit U.S. tariffs on China are well into their third week, the impacts are beginning to manifest.

“What direction will we take next? The outcomes of the Politburo meeting need to chart the way ahead,” Wang stated.

Currently, it appears Beijing is remaining steadfast in its hardline approach against Washington’s demands, according to Wang.

“The assertive posture of ‘aligning domestic economic efforts with international trade conflicts’ suggests that the CCP is determined to persist in this trade war. They seem prepared for a prolonged confrontation with the United States,” Wang remarked, calling it a “chilling message.”

This strategy also poses risks to the Politburo’s commitment to sustaining domestic economic stability, warns Sun Kuo-hsiang, a professor at Nanhua University in Taiwan.

“China’s economy is under considerable internal strain,” Sun expressed to The Epoch Times. “In light of a decelerating economy, an inflexible approach to trade conflicts constrains Beijing’s strategic options in addressing domestic challenges.”

The official statistics from the National Bureau of Statistics of China (NBS) released on April 16 indicate that China’s economy grew at a 5.4 percent annual rate in the first quarter, exceeding analysts’ projections. However, economists remain doubtful about the viability of sustaining this growth rate.

Recent adjustments by global investment banks have lowered their growth forecasts for China this year, citing concerns that the substantial U.S. tariffs might undermine its export sector. The most pessimistic prediction comes from UBS, whose economists foresee a mere 3.4 percent growth for China this year due to these tariffs.

“It seems to be increasingly common for companies to hesitate in hiring, and young individuals are struggling to find employment,” he noted.

Employees produce garments at a clothing factory in Guangzhou in Guangdong Province, China, on April 16, 2025. (Jade Gao/AFP via Getty Images) — Employees produce garments at a clothing factory in Guangzhou in Guangdong Province, China, on April 16, 2025.Jade Gao/AFP via Getty Images

The official statement from Friday’s meeting highlighted the critical need to stabilize employment, reiterating its importance while committing to enhance job security through increased unemployment insurance for companies adversely impacted by tariffs.

The latest NBS official data shows that 16.5 percent of Chinese citizens ages 16 to 24 in urban areas were unemployed in March. Although this marked a reversal of a two-month trend of rising unemployment, the official statistics have been criticized for not accurately reflecting the full scope of the unemployment crisis in the country. Beijing’s measures omit students, those in rural areas, or individuals who have stopped seeking work altogether.

Compounding the economic strains is Beijing’s decision to “fight to the end” in its tariff conflict with the United States.

A wave of small to medium-sized Chinese firms engaged in foreign trade have suspended operations or shifted focus to the domestic market, jeopardizing millions of Chinese jobs.

Goldman Sachs has estimated that the U.S. tariffs could threaten up to 20 million jobs tied to exports in China, with the downturn in exports alongside a sluggish global economy putting immense pressure on China’s labor market.

In light of these challenges, Sun predicts that Beijing may resort to heightened social control measures.

“By tightening ideological and speech restrictions, China might achieve stability, but this approach will further stifle innovation and vitality, creating a policy dilemma for its economic survival,” he warned.

Luo Ya contributed to this report.

Source link