The Trump administration launched a new trade war against China and its traditional allies in Asia, Japan and South Korea in the first few weeks after his nomination. The objective was to correct what Washington saw as systemic economic imbalances and unfair trade practices, including undervalued currencies – Japanese yen, or Chinese yuan. This posture follows theAmerica first policy of his first mandate, when Donald Trump unilaterally decided to quit the Trans-Pacific Partnership (TPP), a brainchild of Japan, the closest ally of the United States in the region.
Beyond tariffs and countermeasures, the broader consequences of this economic confrontation may significantly reshape Asia’s strategic landscape. As the region continues to navigate the aftershocks of these policies, the long-term implications remain fluid, with major actors recalibrating their positions in response to an evolving geopolitical order.
Japan wary of the consequences, ready to “rebalance” with China?
The trade war could exacerbate a delicate balancing act for Japan. While Tokyo, a direct victim of Beijing’s territorial assertiveness, is aligned with Washington in its concerns over China’s expanding technological and economic influence, Japan has always had its own set of priorities – economic stability, regional security, and respect for the territorialstatus quo, but also, despite numerous declarations, the preservation of a functional relationship with China, its largest trading partner. Suppose the US economic policy toward Asian countries, putting allies and rivals in the same category, remains unpredictable: in that case, Japan might feel compelled to take a more independent approach between Washington and Beijing. The prospect of being left isolated in an increasingly fragmented regional order could encourage Japan to deepen diplomatic and economic ties with China, of course not out of ideological affinity or strategic convergence, but out of necessity.
The Russia factor
Another concern is the new posture on Ukraine and Russia adopted by the Trump administration. It is disturbing given Japan’s longstanding territorial dispute with Russia over the Kuril Islands (Northern Territories). Recent geopolitical shifts have added new layers of complexity to this issue. If the United States pursues its new policy of rapprochement with Russia without considering Japan’s strategic dilemmas, Tokyo could face the unsettling prospect of being left alone to manage a more assertive Russia after having antagonized Moscow by adopting sanctions after 2022, contrary to its position after the annexation of Crimea in 2014.
The partnership between Moscow and Beijing only adds to this uncertainty. Should Russia enter into a new relationship with the United States, China might not be as interested in a “no limit partnership” with a Russia that strengthens its position in the Pacific and in Europe. As a result, Japan might find itself reassessing its security priorities and partnerships. Despite the positive results of the Ishiba-Trump bilateral meeting in January, on March 6, 2025, President Trump declared more provocatively: “I love Japan… But we have an interesting relationship with Japan where we have to protect them, but they don’t have to protect us”. This raised new uncertainties in a troubled relationship.
Towards China’s tactical “appeasement” strategy with its neighbors
Meanwhile, the PRC has had to adjust to the consequences of the trade war launched by Washington. The initial escalation of the US-China economic conflict, particularly its ban on critical technologies, left Beijing scrambling to manage its domestic economic vulnerabilities while mitigating regional isolation risks. If this trend continues, China might pursue a more pragmatic approach, emphasizing economic diplomacy rather than outright confrontation. Instead of aggressive trade retaliation, Beijing could seek to rebuild trust with its neighbors through strategic investments and cooperative initiatives, particularly in Southeast Asia and even, to some extent, with Japan.
This recalibration might also be driven by the realization that if China hopes to win back some of the goodwill lost due to its regional military assertiveness, it may have to adopt a softer tone – at least temporarily. Rather than escalating tensions, Beijing might opt for a more calculated charm offensive, using trade partnerships and diplomatic overtures to reestablish itself as an indispensable economic partner. Indeed, Chinese Minister of Foreign Affairs Wang Yi could freely criticize the Trump administration’s “irresponsibility” at a press conference on March 7. Such a shift would, of course, not signal a change in China’s long-term ambitions, particularly regarding Taiwan and territorial claims in the East and South China Seas, but rather a tactical adjustment to ensure that the United States does not gain the upper hand in rallying regional opposition to Beijing’s influence.
The end of trust and the fraying of US-led alliances in the region
For the United States, the question remains whether its aggressive and indiscriminate trade war policies will ultimately serve its broader strategic goals in Asia and beyond. While some in the Trump administration may have seen economic pressure and tough policy as a means to contain China’s rise, the results remain unsure. If Washington continues to take a confrontational stance without considering the interests of its friends and the broader geopolitical ramifications, it risks pushing regional allies into a position where they must seek alternative arrangements.
Japan, South Korea, and some ASEAN nations could find themselves in a situation where aligning with the United States comes at the cost of their economic stability with no guarantee of protection. If this scenario plays out, Washington may find its influence in Asia decreasing, not because of military weakness but because of a failure to provide a coherent and sustainable economic strategy that aligns with the interests of its allies and provides the certitude of engagement in case of a crisis. Another uncertainty arises from the fact that Donald Trump, looking for a deal, might be amenable to better relations with China and new negotiations with North Korea, opening the way to further destabilization in the region.
This evolving strategic landscape raises an important question: what if Asia’s traditional security and economic alignments shift more unpredictably? If Japan deepens its economic cooperation with China while maintaining its security alliance with the United States – not a first in Japan’s foreign policy –, the region could see a more nuanced form of diplomacy emerge – less about binary alliances, more about pragmatic, issue-specific partnerships. Similarly, if China decides to recalibrate its approach, focusing more on economic integration than on outright competition, it could delay or even prevent the kind of full-scale decoupling that some in Washington have predicted.
Yet, uncertainty remains. If future US administrations adopt a more consistent approach to economic and security policy in Asia, these shifts could be slowed or reversed. But if unpredictability persists – whether in the form of abrupt tariff policies, shifting security commitments, or inconsistent diplomatic messaging –, Asian nations may feel increasingly compelled to forge their paths, with or without Washington’s approval.
Finally, the consequence of Trump’s trade war might not be China’s economic collapse – even if China’s economy faces difficulties – or a decisive US victory in the competition. It could be the acceleration of the crumbling of strategic balances in the region, including the proliferation of nuclear weapons. If this is the case, Washington will need to rethink not just its economic policies but its entire approach to Asian geopolitics.