China appoints Li Chenggang new trade envoy in face of tariff turmoil

In a move that caught many observers off guard, China has appointed Li Chenggang as its new trade envoy amid escalating trade tensions with the United States. Li, a seasoned diplomat and former assistant commerce minister, replaces Vice Commerce Minister Wang Shouwen, a veteran of numerous trade negotiations.

The leadership change comes at a critical moment. Washington’s aggressive tariff hikes—initially introduced by former President Donald Trump and now increased to as high as 145%—continue to intensify pressure on Beijing’s export-driven economy. In response, China has raised its own tariffs on US goods to 125%, signaling that both sides remain entrenched in the trade standoff.

Beijing, while signaling openness to talks, has not yet taken steps toward de-escalation. With both countries yet to resume formal negotiations, Li Chenggang, 58, is expected to play a central role should dialogue resume. A former deputy permanent representative to the United Nations in Geneva, Li also brings deep institutional experience from within China’s commerce ministry.

Alfredo Montufar-Helu, senior advisor at the Conference Board’s China Centre, told Reuters that the leadership shakeup appears sudden and may indicate dissatisfaction at the highest levels in Beijing. “It might be that in the view of China’s top leadership, given how tensions have continued escalating, they need someone else to break the impasse… and finally start negotiating,” he said.

However, other analysts suggest the appointment could simply be a routine promotion coinciding with an increasingly volatile period in global trade.

On the economic front, China reported 5.4% GDP growth for the first quarter of 2025—beating expectations—but the data reflects a period before US tariffs surged. Deputy Commissioner of the National Bureau of Statistics (NBS), Sheng Laiyun, warned that the levies will challenge China’s trade sector, though he emphasized that the country’s economy remains resilient.

“We firmly oppose the US practice of tariff barriers and trade bullying,” Sheng stated, arguing that such policies violate WTO principles and destabilize global recovery efforts.

State-run media has echoed similar sentiments. In a recent editorial, China Daily described US actions as “capricious and destructive,” asserting that Washington should “stop whining about itself being a victim in global trade.” The outlet added, “The US is not getting ripped off by anybody… rather it has been taking a free ride on the globalisation train.”

Despite solid factory output and rising retail sales in March, analysts caution that some of the economic momentum may have stemmed from manufacturers “front loading” exports to get ahead of the tariffs. Many expect export numbers to dip sharply in the coming months as the full impact of US tariffs takes hold.

Meanwhile, China continues to face a sluggish property sector, with investment dropping nearly 10% year-on-year and home prices stagnating. Officials say they have ample policy tools to stimulate growth, but boosting domestic consumption will be key as external trade pressures mount.