US President Donald Trump’s Joint Address to Congress and the opening of the ‘Two Sessions’, China’s hottest political event of the year, at the same time? Call it Barbenheimer for political news junkies.
In any event, the parallels between Washington and Beijing’s announcements revealed more than just coincidental timing.
- 🇨🇳 Beijing’s playbook
Beijing is aiming for “around 5%” GDP growth this year. Putting aside long-standing questions about the reliability of Chinese economic data, the goal is ambitious, given the IMF’s more modest 4.6% projection. And that’s before we consider President Trump’s latest 10% tariff on Chinese imports.
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Nevertheless, China has a reason for optimism: it says it beat last year’s target, logging 5.4% growth, though Li admitted that “adverse changes in the international environment” could make 2025 a much bumpier ride.
Beijing is also planning to increase its defence spending to $245B, marking a 7.2% increase year-on-year. That will make China’s military funding second only to Washington’s (~$850B per year).
There were no surprises on the ‘Taiwan question’ — “We will firmly advance the cause of China’s reunification and work with our fellow Chinese in Taiwan to realise the glorious cause of the rejuvenation of the Chinese nation,” Li announced.
- 🇺🇸 Meanwhile in Washington…
Calling the Chinese economic playbook unfair to the US, President Trump told the Joint Session of Congress on Tuesday that reciprocal tariffs on Chinese goods will kick in on 2 April, noting that he avoided 1 April to make sure people knew he was serious.
Trump added that “whatever they tax us, we will tax them,” because “we’ve been ripped off by nearly every country on earth.”
The S&P 500 has retreated to about where it was before President Trump’s election in November in large part due to uncertainty around tariffs. But Trump, who is known to take cues from stock market fluctuations, is so far sticking to his tariff-forward approach, including 25% tariffs on Mexico and Canada.
President Trump also reiterated his plan to boost defence. He doubled down on building an ‘Iron Dome for America’, a reference to Israel’s rocket defence system, as well as announcing a new office of shipbuilding, apparently prompted by seeing images of rust-streaked US Navy ships:
“I jokingly say President Trump has texted me numerous times very late at night, sometimes after one [o’clock] in the morning about rusty ships or ships in a yard, asking me what am I doing about it,” Navy Secretary nominee John Phelan told Congress.
Lastly, there was a surprise on the ‘Greenland question’ — “We strongly support [the people’ of Greenland’s] right to determine their own future… but we need Greenland for national security and I think… one way or another, we’re going to get it.”
INTRIGUE’S TAKE
First things first — our hearts go out to the 56,865 Greenlanders who find themselves suddenly facing the prospect of tipping 20% for a cup of takeaway coffee or needing to figure out what the heck a fluid ounce is.
Now, Trump (probably) isn’t as serious about “acquiring” Greenland as Li Qiang and Xi Jinping are about “reunifying” Taiwan, but the similarities in how Washington and Beijing see the future are interesting.
Both countries are:
- Spending big to prop up growth in a deglobalising world
- Rebuilding key industries with a view to achieving economic independence in critical sectors that had been overlooked during the ‘good times’
- And flexing their military muscles to foster nationalism at home and project strength abroad.
With the US, China, and Europe all pledging to increase their military capabilities, it’s no wonder it’s a good time to be in the weapons business.
Also worth noting:
- Elbridge Colby, the nominee for the No. 3. spot at the Pentagon and a longtime advocate for countering China, endured a difficult Congressional confirmation hearing on Tuesday. Republican Senator Roger Wicker warned the US “cannot simply pivot” militarily between regions of the world.
- If you’re a glutton for punishment, here’s an English translation of the Report on the Work of the Government.
