Donald Trump's “Liberation Day” prices are shocking on the world markets and rekindle fears of an prolonged trade war. The American president can reconsider some of his most disruptive prices while he floats the possibility of an agreement, but he also continues to threaten new measures on goods such as semiconductors and pharmaceutical products while trying to shake the global trade system.
How will the prices affect the Chinese technological sector which, even only a month ago – led to the success of the Deepseek AI model?
China has been preparing since Trump imposed prices for the first time in 2018. Beijing has long been planned a second round with the United States faced with more strict restrictions on its access to advanced technology, China has methodically built its technological supply chains. It is not only a question of building local flea factories: Beijing measures include strengthening the capacity of renewable energies, creating cloud computing capacities through national projects like East Data West Compute and investing in LIDAR technology and batteries.
Beijing does not try to go beyond American innovation in IA infrastructure. Instead, he takes advantage of his manufacturing and doubles expertise from physical AI, such as robotics and compatible AI electric vehicles.
Chinese chip industry is still lagging behind. But it is much more self-sufficient today than five years ago, when the United States began to tighten the screws on flea exports. The force of the country goes beyond the equipment, because the models of open-source DEEPSEEK AI make the llms affordable possible.
The United States will probably continue to force the China technological sector, even if Trump goes back to his pricing threats. Measures such as flea export orders now benefit from bipartite support in Washington.
AI companies like Alibaba, Bytedance and Deepseek previously leaned on the controversial Nvidia H20 chip, until recently the most advanced processor that could be legally sold in China, were vital. A complete ban will require large technological companies in China to rethink their flea strategy – and perhaps consider alternatives, as those manufactured by Huawei.
Analysts suggest that Huawei's revenues will probably see a big leap in income while customers turn to their AI systems instead of Nvidia. A recent semiianalysis report suggests that Huawei's last product could even exceed Nvidia in certain configurations.
Export controls, targeted prices and industrial policy can be logical for the United States worried about strategic competition and the need for more resilient supply chains. And that's why China did the same.
Supply chain
Since 2018, large and small companies have moved manufacturing and supply in countries such as Vietnam, Bangladesh and Thailand. But companies cannot completely cut China. Like Apple CEO, Tim Cook, noted it in 2015, it is difficult to correspond to the combination of the scale, labor skills and China infrastructure, at least in the short term. Over 80% of iPhones are still made in China.
Trump's punitive prices do not only increase the costs for consumers. They will force us Big Tech to rethink the strategies of the supply chain which have taken decades to build. Unpredictability, not prices, is the real tax for global companies that depend on long -term planning and stable conditions. Each policy adjusts, whether its prices, export prohibitions, black lists or exemptions, undulations via global markets.
For some Chinese companies, this results in a prudent “expected” position and opposed to risk, in break and focusing on non -American affairs for the moment. Chinese companies are already discreetly hidden against commercial disturbances: the construction of the internal market first, rethinking their expansion strategies, or relaunching development and sales to more friendly jurisdictions.
Prices also affect Chinese AI plans, although indirectly. AI startups in China serve the wider technological sector; The leaders will rethink AI plans will have an downstream effect on the ia startup ecosystem in China.
AI, cloud computing and semiconductors are not isolated sectors. They are built on an academic, commercial and government collaboration through borders. Technological progress always benefits openness, regardless of the value of strategic autonomy.
Aggravating things is an increasing wave of anti-Chinese feeling in the world. The confusion of ethnicity, nationality and geopolitics has become much more common since the cocovio pandemic. The growing fears concerning China erod a feeling of confidence and security and damage the social fabric that underpins global innovation. And it can be self-deficit, as shown by the regular return of Chinese academics, worried about prejudices, returning to China.
What happens next?
The United States may hope that the right mixture of prices, subsidies and export controls can preserve technological leadership. But instead, the pressure continues to cut China access to advanced technologies will make it more self -sufficient by necessity. The trade war, even if it leads to an agreement, will push China to invest even more in its technological sector. The next time the United States is trying something like the ban on H20 flea, this can mean very little for the China AI ecosystem.
Competition can be healthy, but does not need to signify the collapse. The challenge for the United States and China is to draw clear railings to support national security without fully closing collaboration. Climate technology, health care, IA security and open source development could always present real cooperative leadership possibilities.
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