U.S. trading partners, feeling burned by an unpredictable and transactional White House, are reassessing China in a drive to lessen their longstanding reliance on America.
From Canada to Europe and South Korea, America’s postwar allies are scouring the globe for alternative markets. Some are weighing closer ties to China, the world’s second-largest economy after the U.S., even as they worry about Beijing’s economic and military might and the risk of U.S. retaliation.
President Trump on Saturday threatened 100% tariffs on Canadian goods if the country “makes a deal” with China, highlighting how the world’s middle powers are increasingly under pressure to choose between what many of them view as bad options.
The threat came after Canadian Prime Minister Mark Carney this month announced a sharp cut in Canada’s levies on Chinese-made electric vehicles and touted a “new strategic partnership” with China. Treasury Secretary Scott Bessent later suggested to ABC News that Trump’s threat related to a broad free-trade deal with China—something Carney says Canada isn’t pursuing.
Carney isn’t alone in taking tentative steps to mend ties with China. British Prime Minister Keir Starmer will travel to Beijing this week to meet with Chinese leader Xi Jinping—the first visit by a U.K. prime minister in eight years. South Korean President Lee Jae Myung said recently that he wants a “full-scale restoration” of ties with China.
Others are more skeptical. The European Union said recently that it is open to price floors as a replacement for tariffs on Chinese EVs, although policymakers in the bloc remain hesitant about any broader rapprochement and haven’t backed down in other areas.
Finnish Prime Minister Petteri Orpo is due to meet with Xi in Beijing on Tuesday, and German leader Friedrich Merz is expected to travel to China next month.
Few expect a return to the more optimistic period of Sino-Western relations before Xi came to power in 2012, when both sides were bullish about trade and investments.
Instead, many capitals have launched delicate hedging exercises to stop relations with Beijing from deteriorating further. The hope is that China opens its domestic markets, imports more foreign goods and continues to invest across Western nations.
As countries deal with a less predictable U.S., “It’s not that China becomes more attractive, but it becomes more necessary,” said Mikko Huotari, executive director of the Berlin-based Mercator Institute for China Studies.
That contrasts sharply with Trump’s first term in office. At America’s urging, many countries across the West put relations with China in the deep freeze amid concerns about economic espionage, intellectual-property theft and the destruction of industrial heartlands caused by a flood of ultracheap Chinese imports.
Beijing’s support for Russia’s war in Ukraine and China’s pressure campaign on Taiwan remain significant barriers for U.S. allies weighing closer relations. Japan and China are locked in a dispute over Taiwan after Japanese Prime Minister Sanae Takaichi suggested her country could be dragged into war if China pushes to seize the island.
China has also shown its willingness to use trade to apply political pressure, including with last year’s restrictions on rare-earth exports.
Other U.S. allies aren’t dismissing China’s risks. But Trump’s tariffs—and his recent push to pry Greenland from Denmark—are nonetheless encouraging some to reconsider how they engage with Beijing.
The gain for China could be substantial, including driving a wedge between the U.S. and some of its most historic allies.
Carney said this month that Canada would allow 49,000 Chinese-made EVs to enter the country at a sharply lower tariff rate, and that Beijing would lower its levies for Canadian canola oil. He also talked about a new strategic partnership with China that he said “reflects the world as it is today.”
In the U.K., the British government smoothed the way for Starmer’s trip to Beijing by approving the building of a new Chinese mega embassy in London. The project had been put on the back burner following the purchase of the old Royal Mint building in London in 2018, after relations between China and the U.K. soured over China’s treatment of Hong Kong, a former British colony.
Britain also restarted trade talks with Beijing last year, after a yearslong hiatus.
The EU has been more reticent. The bloc adopted a tougher stance on China in recent years, through a policy it refers to as derisking, and opened dozens of trade investigations into Chinese imports. Beijing’s curbs on rare earths and the fallout from a recent fight for control of Dutch chip maker Nexperia also eroded European trust.
But in a move China welcomed, the bloc recently issued guidance for EV makers to apply for a price floor as an alternative to tariffs. The guidance said the EU will consider companies’ proposals on a case-by-case basis, but doesn’t guarantee that levies will be lifted.
In many cases, Western allies’ economic exposure to America is too large to be replaced by China. The EU sent about $630 billion worth of goods to the U.S. in 2024, according to the bloc’s data, accounting for roughly one-fifth of total shipments. Exports to China were less than half of that, at about $250 billion.
The EU has focused most of its trade diversification efforts on reaching deals with a range of middle powers. It signed a trade pact with four South American countries this month and could announce a deal with India as soon as this week. The U.K. and Canada have also sought to boost trade with other partners.
The push to look beyond the U.S. and China partly reflects a concern that allies could be caught between the two economic powers. Some worry that Trump’s planned summit with Xi, expected in April, could lead to a deal that runs against their interests or undermines agreements they have already made.
U.S.-China relations are increasingly driven by Trump’s relationship with Xi rather than any coordinated effort with allies, said Kyle Chan, a fellow with the Brookings Institution.
“There’s no longer a clear, concerted strategy to address the common challenges that many countries face” on trade and security issues with China, Chan said.
Write to Kim Mackrael at kim.mackrael@wsj.com and Max Colchester at Max.Colchester@wsj.com