---
title: "Xi Jinping's actions could lead to another trade war"
url: https://burnaze.com/article/84d09e5c-874a-4039-91d9-e5966f3c64b5
source: "Franchise Magazine USA"
original_url: https://franchisemagazineusa.com/xi-jinpings-actions-could-lead-to-another-trade-war/
category: "General"
published: 2024-01-20T12:32:24.000Z
modified: 2026-11-01T01:05:53.222Z
image: https://franchisemagazineusa.com/wp-content/uploads/2024/01/20240113_FNP001.jpg
---

# Xi Jinping's actions could lead to another trade war

**TL;DR:** China, under Xi Jinping's leadership, is focusing on lithium-ion batteries, electric cars, and solar panels, which could lead to a manufacturing export boom and potentially trigger a new trade war. The country's manufacturing output may rise to 36% of global share, causing concerns among Western policymakers and leading to probes and tariffs on Chinese goods.

*originally published in Franchise Magazine USA on 2024-01-20. [Read the original](https://franchisemagazineusa.com/xi-jinpings-actions-could-lead-to-another-trade-war/).*

## Key facts

- China's manufacturing output may rise to 36% of global share
- Western countries are launching probes and tariffs on Chinese goods
- China's currency is depreciating

## Story

China, under Xi Jinping’s leadership, has a new focus: lithium-ion batteries, electric cars, and solar panels. Xi is banking on these technologies to be driving forces of the economy in the years ahead, and he is investing heavily to make it a reality. However, the potential economic impacts of these ambitions are not limited to China. The manufacturing export boom that could ensue has the potential to trigger a new trade war.

Xi’s fervent pursuit of manufacturing is a response to China’s struggling property market which has been dragging down the country’s economic growth. China’s 100 largest real-estate developers saw sales drop by 17% in 2023, with overall investment in residential buildings down by 8%. In response, state-owned banks are funneling cash to industrial firms while exporters have been instructed to ramp up production in exchange for pandemic-era tax breaks and special incentives for green industries.

This trajectory is raising concerns among Western policymakers, who remember the massive impact China’s emergence had on global trade in the previous decade. Back then, China’s exports surged by over 460% following its accession to the World Trade Organization, leading to accusations of dumping and creating tensions with affected industries in the rich world. The “China shock” was later linked to political events such as the election of Donald Trump in 2016, reflecting the societal reverberations of China’s expansion.

## Manufacturing output growth

If Xi’s ambitions were to be fulfilled, the increase in China’s manufacturing output would be staggering. Analysts predict that China’s share of global manufacturing output could rise from 31% to 36% if it achieves its growth targets. This expansion is expected to be supported by China’s extensive capital investment, which far exceeds that of the United States.

However, this boom in manufacturing has consequences. China’s currency is depreciating, affecting its global competitors. Western politicians are also on high alert, with several countries launching probes and implementing tariffs on various Chinese goods. As a result, anti-dumping investigations are on the rise, with India imposing fresh duties on Chinese steel, and Mexico levying tariffs on Chinese imports.

## Economic challenges ahead

China’s leadership now faces a dilemma. Industrial overcapacity and weak domestic demand are pressing issues. There may be no easy way out of this situation, and the potential consequences of these economic challenges are vast. Yet, the continued pursuit and expansion of China’s manufacturing sector might be key to revitalizing the economy and keeping it afloat in an uncertain market landscape.

It’s clear that China’s ambitions are not just a matter of domestic policy; they could have significant implications for the global economy. The interplay between a thriving manufacturing sector and the resulting trade tensions are issues that will likely define the next chapter of the global economy. For more expert insights and analysis on economic, financial, and market developments, consider signing up for our weekly subscriber-only newsletter, Money Talks, for an in-depth look at the biggest stories shaping today’s world.

## Entities

- General (sector)
- Franchise Magazine USA (publication)
- China (location)
- Donald Trump (person)
- trade war (topic)
- solar panels (topic)
- manufacturing export (topic)
- lithium-ion batteries (topic)
- electric cars (topic)

---
Originally reported by Franchise Magazine USA (https://franchisemagazineusa.com/xi-jinpings-actions-could-lead-to-another-trade-war/). Summarized by Burnaze (https://burnaze.com/article/84d09e5c-874a-4039-91d9-e5966f3c64b5).