Billionaire investor Bill Ackman warned that China cannot win a prolonged trade war with the United States and must seek a quick deal to avoid lasting economic damage.
Key Facts:
- Bill Ackman said China should strike a trade deal with the U.S. quickly to avoid severe economic consequences.
- Ackman warned that prolonged tariffs will push companies to move supply chains to other countries like India, Vietnam, Mexico, and the U.S.
- President Trump has imposed 145% tariffs on most Chinese goods, sparking retaliation from Beijing.
- China has resisted negotiations, with President Xi Jinping rebuffing Trump’s outreach and demanding more respect from the U.S.
- Bloomberg reported that China is considering lifting some tariffs as the economic toll grows.
The Rest of The Story:
Bill Ackman posted on X that China is running out of time to secure a favorable trade deal with the United States.
He argued that if Beijing holds out, companies will move their manufacturing operations elsewhere, permanently damaging China’s economy.
Ackman emphasized that while pride may tempt China to delay, doing so would have more lasting economic harm.
While some believe China can weather President Trump’s tariffs, Ackman sees the situation differently.
Trump’s administration has levied tariffs of 145% on most Chinese goods, leading to a sharp downturn in trade between the two nations.
Reports suggest that the Chinese government is feeling the pressure and may soon lower some tariffs to ease economic strain.
Ackman believes both nations recognize that current tariffs are unsustainable.
He said the main hurdle to lowering them is political optics, with both sides trying to avoid appearing weak.
Ackman, once a strong Democrat donor, has more recently supported Trump’s tough stance on trade and foreign policy.
Some have suggested that because China takes a very long-term view, China can ‘win’ a trade war with the U.S. which, according to the conventional view, is a much shorter-term player than China.
The problem with this assessment is that the longer the tariffs persist, the more… https://t.co/pDqMUhddSi
— Bill Ackman (@BillAckman) April 26, 2025
Commentary:
Ackman’s assessment makes a lot of sense.
China’s economy is heavily dependent on exports, especially to the United States.
Factories are already slowing down, and cargo is backing up at Chinese ports.
Every day that passes without a deal increases the chance that businesses permanently shift operations to other countries.
China faces real risks by dragging its feet.
If companies find better, more stable partners in India, Vietnam, Mexico, or even back home in the U.S., they won’t return to China later.
Once trust is broken, it’s extremely hard to rebuild, especially in global trade where time and reliability matter most.
China’s leadership also has to balance political pride with practical economic needs.
Although Xi Jinping wants to project strength, the facts on the ground show a country facing mounting pressures.
The economic fallout from a prolonged standoff could threaten domestic stability, something Beijing cannot afford.
Meanwhile, the United States has alternative options.
Mexico is increasingly attractive for American manufacturers, and Vietnam and India are already seeing a surge in foreign investment.
The U.S. holds a strong position in this negotiation — stronger than some experts acknowledge.
Ackman is correct that the longer China delays, the worse the outcome will be for them.
If they act soon, they can still preserve some of their manufacturing dominance.
If they don’t, they risk a permanent shift in the global supply chain, leaving China economically weakened for years to come.
The Bottom Line:
Bill Ackman’s warning to China is grounded in economic reality.
The U.S. holds the stronger hand, and the clock is ticking for Beijing.
If China refuses to negotiate out of pride, the long-term damage to its economy could be severe and irreversible.
A quick, mutual agreement would benefit both sides before the fallout becomes permanent.
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