China Condemns Trump Trade Probe as It Adopts New Five‑Year Tech and Industry Plan
China’s Foreign Ministry denounced the Trump administration’s newly opened trade investigation into alleged manufacturing overcapacity in China, Mexico, the European Union and other economies, calling it a 'pretext for political manipulation' and rejecting U.S. claims that Chinese overcapacity exists. U.S. Trade Representative Jamieson Greer launched the probe after the Supreme Court struck down Trump’s earlier global tariffs, setting up a potential new legal pathway to levy duties on countries deemed to discriminate against U.S. firms. As this diplomatic shot landed just weeks before a planned Trump–Xi summit, China’s National People’s Congress approved a new Five‑Year Plan that sharply increases R&D spending (over 7% annually) to boost technological self‑reliance and leadership in semiconductors, aerospace, robotics, biomedicine, quantum tech and 'low‑altitude' industries like drones and flying taxis. The plan also doubles down on advanced manufacturing powered by AI and robotics, effectively signaling that Beijing will continue the state‑driven industrial model that has long fueled U.S. and European complaints about dumping and oversupply, even as Chinese state media insists 'tech sovereignty is not about isolation.' The combination of Washington’s legal re‑arming on tariffs and Beijing’s more assertive industrial blueprint raises the stakes for another round of U.S.–China trade and tech conflict that would hit American exporters, importers and investors across multiple sectors.
📌 Key Facts
- U.S. Trade Representative Jamieson Greer opened a new investigation Wednesday into 'excess capacity and production in manufacturing sectors' in countries including China, Mexico and the EU, after the Supreme Court struck down Trump’s earlier tariffs.
- On Thursday, March 12, 2026, China’s Foreign Ministry spokesperson Guo Jiakun condemned the probe, saying 'we oppose any form of unilateral tariff measures' and calling the overcapacity issue a non‑existent 'pretext for political manipulation.'
- The same day, China’s National People’s Congress approved a Five‑Year Plan that boosts R&D spending by more than 7% annually, prioritizes self‑reliance in high‑end tech like semiconductors and aircraft engines, seeks global leadership in emerging fields from biomedicine to quantum and drones, and calls for a 'modern industrial system with advanced manufacturing as its backbone.'
📊 Relevant Data
In 2025, China's global trade surplus reached a record $1.2 trillion, up 5.5% from 2024, driven by overcapacity pushing firms to export excess production.
China's overcapacity threatens to reshuffle global industrial bases — MERICS
The US goods trade deficit with China decreased to $202.1 billion in 2025, down from higher levels in prior years, with US exports to China falling to $106.3 billion.
U.S. International Trade in Goods and Services, December and Annual 2025 — Bureau of Economic Analysis
US manufacturing employment declined by 108,000 jobs in 2025, with sectors like home appliance production particularly affected amid trade tensions with China.
U.S. manufacturing employment is down 108,000 in 2025 — Progressive Policy Institute
Manufacturing job losses from Chinese import competition have disproportionately affected non-college-educated workers in the US, with significant negative employment effects in regions with lower educational attainment.
Did the “China Shock” Cause Widespread Job Losses in the U.S.? — Stanford Center on China's Economy and Institutions
Historical data shows that the 'China Shock' led to manufacturing job losses that were particularly devastating for Black and Hispanic workers in the US, exacerbating employment disparities.
Botched policy responses to globalization have decimated manufacturing jobs for workers of color — Economic Policy Institute
📰 Source Timeline (1)
Follow how coverage of this story developed over time