DONALD Trump’s return to the White House may still be over 50 days away, but the tone of US-China relations are becoming increasingly terse by the day. 

The opening shots in Trump’s confrontational new trade policy may have confirmed that the 10% levy on Chinese goods will be lower than the 60% he had previously suggested, but potential for a trade war escalation is clear.

When it comes to Trump’s sanctions policy there are fewer details available, but there is a worrying rhetoric emerging over Hong Kong that could have serious implications for shipping.

Accusations from US lawmakers that Hong Kong has become a critical hub for the “authoritarian axis” of China, Iran, Russia and North Korea have understandably riled the Hong Kong administration. 

These are crude and reprehensible lies, they argue. 

Crude, perhaps, but there is inevitably some truth there as well. 

The question is what Trump intends to do about it.

At a recent Lloyd’s List Intelligence forum in Hong Kong, concerns were raised about the extensive enforcement reach of the US, EU, and UK, including their targeting of secondary facilitators.

Over the past few months, the US has sanctioned a string of Chinese companies, many registered in Hong Kong, for allegedly flouting export controls on the Kremlin or engaging in energy deals with Russia and Iran.

Right now, the legal and financial services shipping community in Hong Kong is nervous, but they are more worried about what comes next with Trump. 

In the same way that Trump is ostensibly justifying the China tariffs over their failure to control the US drugs trades, the failure of China, or Hong Kong, to control US sanctions could easily become a political flash point.

Or not.

Whether the tariffs end up being leverage to strike a deal, or sanctions become a bargaining chip in a wider negotiation, there is a growing sense that the rules are changing and leverage will be applied against allies and adversaries alike.

Consider this an early reminder that uncertainty is destined to become the overriding driver of shipping risk in 2025.

Richard Meade
Editor-in-chief, Lloyd’s List

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