By trying to weaponize the U.S. tariffs on America's big trade partners against China, President Trump is basing bad economics on worse geopolitics. It could prove a costly prelude to a global downturn.

China and the U.S. should not entangle themselves in trade imbalances and tariffs but find a new, innovative perspective. The future will be shaped by AI, big data, quantum computing and telecom. Both countries have tremendous common interests.

Among the many factors pointing to economic uncertainty, the most significant is the tariff and trade war that Donald Trump has pledged to initiate. At the same time, from a global perspective, the overall macroeconomic situation improved over the past year and could continue in a positive direction.

Trump’s old concept of tariffs originates in U.S. policies from the 19th century. He believes that he excels in the art of creating a “level playing field” to generate jobs at home. But what he is proposing would be the highest tariff level since the Great Depression.

Donald Trump’s trade policies have been characterized by an aggressive use of tariffs, driven by his belief in balancing bilateral trade and prioritizing American production. While these measures have reshaped trade dynamics and escalated protectionism within the U.S., they have also inadvertently strengthened China's global economic position and highlighted the limitations of decoupling efforts.

I saw nothing but denial in my recent post-US-election tour of Asia, with stops in Hong Kong, Shenzhen, Beijing, and Singapore. Taking a cue from surging global equity markets, Asians are making every effort to wish away problems at home and abroad.

The Trump administration’s blame-driven approach to U.S.-China relations fueled mutual losses and entrenched scapegoating of China for U.S. domestic issues. Ultimately, subnational diplomacy and pragmatic collaboration are essential for rebuilding constructive ties.

China’s recent monetary stimulus measures initially boosted stock markets but quickly fell short of reviving domestic demand and investment. A "whatever it takes" approach with more forceful fiscal stimulus is essential to reset consumer and investor confidence.

The timing of China’s new stimulus package is not coincidental. Arriving just before the 75th anniversary of the People’s Republic, the announcement was well-received by equity investors, leading to a surge of more than 15% in the country’s main stock indices.