Xi seeks to win over allies as Trump pauses some tariffs

President Xi Jinping's first overseas trip of the year was meant to showcase China's clout in the region. Now, President Donald Trump's tariff threats have turned it into a push to keep Southeast Asian leaders from cutting deals at Beijing's expense.

Xi landed in Vietnam on Monday (14 April) days after Trump raised tariffs on China but gave everyone else a 90-day pause. In doing so, Trump is seeking to punish Beijing for retaliating, while enticing the smaller Asian economies to offer concessions to stave off drastic duty hikes. The Chinese leader is scheduled to visit Malaysia and Cambodia next.

"The fact that Xi Jinping is coming to visit these countries is very significant," said Lynette Ong, professor of Chinese politics at the University of Toronto. "I would read it as Xi's attempt to form alliances to fight back against the United States in the trade war."

The Chinese leader will likely present China as a more stable partner than the US under Trump, whose shifting tariff policies have rattled markets. His visit also highlights the tricky position Southeast Asian nations face. They've become key routes for Chinese exports to reach the US since Trump's tariffs in his first term. Now, as they seek exemptions from the latest duties, they're also worried cheap Chinese goods could be redirected into their own markets.

In an article published in the Vietnamese newspaper Nhan Dan on Monday, Xi repeated his criticism of protectionism, saying China and Vietnam should jointly safeguard the multilateral trade system and stable supply chains.

"There are no winners in trade wars or tariff wars, and protectionism leads nowhere," Xi wrote. He said China is ready to advance three cross-border railway lines in Vietnam's north and welcomes more Vietnamese exports to the country and cooperation in 5G, artificial intelligence and other emerging technologies.

The Trump administration has signaled its terms as Vietnam, Malaysia and Cambodia actively seek to negotiate. His trade adviser Peter Navarro said countries must "stop allowing China to evade US tariffs by trans-shipping exports through your countries" in an article to the Financial Times, naming Vietnam and Cambodia as examples.

The demand places China's neighbors in a precarious position: cut off a lucrative business channel with their largest trading partner, or face crippling US tariffs — 46% for Vietnam, 24% for Malaysia and 49% for Cambodia. There are signs that some are already budging, with Vietnam taking steps to crack down on origin of goods fraud, a move widely seen as a response to US concerns about Chinese transshipment abuses.

"Xi Jinping will arrive here pushing on an open door," Zachary Abuza, professor at the US National War College in Washington, said during an interview in Phnom Penh, citing the regional supply chain's reliance on China and Beijing's permanent diplomatic presence as key factors.

As much as they can, the countries are likely to avoid picking a side in the US-China rivalry, a calculation that's both political and economic in nature.

In Hanoi, distrust of China runs deep over territorial disputes in the South China Sea, but the economy remains dependent on Chinese components and raw materials.

As Xi travels to Kuala Lumpur, he encounters a similar trade terrain. Malaysia exported $44 billion worth of goods to the US last year, slightly more than the $41 billion to China.

The country has asserted its neutrality amid intensifying tensions between the US and China. Prime Minister Anwar Ibrahim is dispatching officials to Washington seeking tariff relief, but simultaneously courts deeper ties with Beijing.

The final stop in Cambodia represents Xi's safest harbor. Prime Minister Hun Manet's government, having inherited his father's pro-China stance, depends heavily on Chinese investment for ambitious infrastructure projects, including a new international airport in Phnom Penh expected to open in June and the strategic Funan Techno Canal.

Chheng Kimlong, president of the Asian Vision Institute in Phnom Penh, said that when it comes to the US and China, Cambodia's biggest concern is the rising competition between the superpowers and fallout from retaliation.

"Cambodia and China are closely connected economies," he said on the sidelines of the Boao Forum in southern China's Hainan Island in March. "If the US continues to see China and other trading partners as competitors, it could have cascading effects on Cambodian export sectors, including manufacturing."

With Beijing unlikely to compromise on territorial matters, promises of greater investment and trade cooperation are likely incentives it can offer to shore up ties.

Last August, Xi promised to expand China's Belt and Road Initiative in a meeting with Vietnam's Communist Party chief To Lam in Beijing. Lam asked Xi for technological support and investment in transport infrastructure.

When Chinese Premier Li Qiang last visited Malaysia, in June, the two countries pledged to deepen economic ties and advance construction of major projects such as the East Coast Rail Link, a $10.6 billion project.

As Cambodia's largest creditor, China can probably count on the country to maintain close ties despite Trump's threats. The gutting of USAID also created a convenient opening for Beijing, which has supported literacy and nutrition initiatives for children after the US abandoned similar efforts.

On trade, Beijing could potentially offer its neighbors greater access to the Chinese market, although it's unclear what trade barriers it could lower or remove.

Last year, Xi cut tariffs for 33 low-income African nations during the Forum on China-Africa Cooperation, which was held in Beijing. Cambodia already effectively enjoys that privilege, and it's "very unlikely" wealthier Malaysia or Vietnam would qualify, according to Eric Olander, co-founder of the China-Global South Project.

"The bigger problem for a lot of these poorer countries is not the duties but the so-called non-tariff barriers that make it difficult to export to China," he said. "China understandably has very high sanitary requirements for food and agriculture products that many of these poor countries struggle to afford the equipment and inspections to meet."

The Chinese leader's Southeast Asian tour forms part of a broader counteroffensive against Trump's isolation strategy. As American tariffs threaten to reconfigure global trade, Beijing has intensified outreach to the European Union, whose relations with Washington have frayed.

EU leaders plan to travel to Beijing in July for a summit with Xi, Bloomberg News reported earlier. The Europeans' willingness to make the trip — despite protocol suggesting the location should rotate to Brussels — signals their eagerness to engage China as a hedge against Trump's unpredictability.

Spanish Prime Minister Pedro Sanchez, completing his third visit to China in two years, praised the relationship Friday, calling Beijing "a partner of the EU."

This diplomatic maneuvering unfolds against economic headwinds in China, whose export sectors — responsible for a third of growth last year — may take a significant hit from US tariffs on most goods exceeding 145%. Persistent deflationary pressures and a property sector crisis continue to weigh on growth, limiting Xi's ability to entice trade partners with sweeteners.

For Southeast Asian nations, the economic stakes could hardly be higher. Trump's tariff pause offers temporary breathing room but demands a near-impossible choice.

The tariff reprieve gives the countries merely "a stay of execution," said Abuza of US National War College in Washington. "They're still on death row."