China may better withstand Trump tariffs this time

THE global market has made a sharp downturn following the US’s implementation of reciprocal tariffs. China has been hit the hardest, facing a blanket tariff rate of 145 per cent.

The MSCI China Index has since given up roughly three-quarters of its earlier gains, which were fuelled by investor enthusiasm around AI developments and renewed domestic stimulus measures. As at Apr 15, the index still recorded a decent year-to-date return of 6 per cent. Compared to other key markets, Chinese equities appear to be showing greater resilience during this downturn.

Patriotic sentiment driving support

China’s “fight-to-the-end” stance, with its retaliatory tariffs against the US, has resonated widely among its people. The extraordinarily high tariffs imposed on Chinese goods have thus unexpectedly helped accelerate the recovery of investor and consumer confidence; both were heavily damaged in recent years by political uncertainty and a sluggish economic outlook.