Global leadership: Trump is making China look like the more reliable candidate

Crisis has come, and that logic has been turned on its head. After six weeks of the US and Israel’s war on Iran and its ensuing counter-attacks, it is the countries that bet on Chinese supply chains that are faring better than the ones that had trusted Pax Americana.

Consider Pakistan. By now it should have been in the middle of yet another economic and social implosion. It has always been vulnerable to energy price shocks, given that it imports almost all of its energy, much of it through the Strait of Hormuz.

The country has $130 billion in external debt and a persistent current account deficit and so the slightest nudge should have tipped it over into a familiar spiral: emergency requests to the International Monetary Fund, 18-hour power blackouts, unrest on the streets.

None of that is visible. There are signs of stress, certainly. Islamabad has hiked fuel prices and is reportedly planning to shut off electricity for two to three hours each day. A sustained shortage of liquid natural gas will make it hard to keep power plants running. But, compared to the situation just a few years ago—when, after the Russian invasion of Ukraine, the economy had a full-scale meltdown—it’s showing remarkable resilience.

What’s the difference? Chinese-made solar panels. Pakistanis have gleefully transitioned to solar power, importing about 17 gigawatts a year of photovoltaics since 2024. A quarter of households have installed solar panels for their own use.

Islamabad didn’t even have to spend too much money subsidizing the renewables rollout. It just had to ride Chinese overcapacity and make it work for Pakistani citizens by keeping tariffs low. The price of imported solar panels dropped by almost 60% in 2024-25; Beijing’s subsidies kept Chinese factories humming but also financed the electrification of millions of households across Pakistan.

Many other countries made the opposite choice in order to insulate domestic production or minimize political risk. Those that tried to keep cheap Chinese photovoltaic cells out have seen much slower rates of uptake—and are, in consequence, far more exposed to chaos in the Gulf.

Nor are solar panels the only way in which cheap Chinese goods are turning out to be sources of resilience rather than disruption. Nepal has a higher proportion of electric vehicles (EVs) than any other country in the world, barring Norway. Its huge imported fleet of cheap EVs mean that it is far less worried about petrol prices than most of its Asian neighbours. And they run on clean electricity, emerging from a hydropower infrastructure that is financed in part by Beijing.

It’s not hard to imagine policymakers from across the developing world looking at examples like these and concluding that betting on Beijing isn’t actually the riskier option. Some may already have taken that chance; imports of Chinese solar panels have shot up in the past couple of years across sub-Saharan Africa in particular. If the only options are dependence on predictably mercantilist Beijing and on an erratic, self-centred and disruptive US, the choice is obvious.

That may turn out to be the wrong call. It is not wise to imagine that relying upon Beijing’s goodwill is any safer. In just the past year, China has shown its willingness to weaponize control over supply chains, such as the production of magnets and rare earths.

But right now, the contrast is glaring. Countries that believed that the world’s open trading order, underpinned by American hegemony, would protect them from shocks are struggling; those who chose to run the risk of dependence upon Chinese imports and infrastructure are showing unexpected resilience.

This will only get worse if the US withdraws from the Gulf without making an effort to reopen the Strait of Hormuz. Then the lesson the world learns is even harsher: America will make decisions about your energy supply, take no responsibility for the consequences, and then leave. China will sell you the technology that allows you to stop caring about what the US does.

This is a far greater geopolitical setback to the US than a loss of face in the Iran war might be. The US president may have thought that he would be remembered as the one who restored American greatness by solving long-running problems—Venezuela, Iran, perhaps Cuba. Instead, it looks like he’ll be remembered as the president who lost Asia to China. ©Bloomberg

The author is a Bloomberg Opinion columnist.