Beijing tells Chinese companies in US to steer clear of price wars

China has called on its companies doing business in the US to avoid extending their price wars to Trump’s territory. The guidance underscores Beijing’s effort to present a more cooperative stance as its exporters face growing scrutiny in Washington over accusations of flooding the US market with cheap goods.

According to the ministry, Commerce Minister Wang Wentao made the comments in a meeting in New York on Tuesday with representatives from 10 Chinese firms in industries such as e-commerce, telecommunications, and auto parts.

Wang said that China and the US have reached a series of important consensus results after several rounds of economic and trade consultations. 

He also said that he hoped businesses would understand what was going on and respond positively. He also told them to “oppose internal and external involution.” This refers to intense competition sparked by excess capacity that forces people to overwork despite diminishing returns.

China and the US’s efforts to work together

US President Donald Trump said he hoped to meet Chinese President Xi Jinping at the Asia-Pacific Economic Cooperation meeting next month. This was after he had a call with President Xi. He also hailed progress toward finalizing a deal over TikTok.

On the other hand, China said that the talks between Xi and Trump were constructive and good, and Xi said that he was sure that Washington and Beijing could work out their differences. However, Xi also said that the US should make it easy for Chinese companies to do business, which showed that he didn’t agree with trade hurdles like export limits.

Meanwhile, Wang has told the business leaders in New York that Beijing will strive to stabilize China-US economic and trade cooperation in line with the central government’s decision-making and deployment. He also said that they will firmly protect the legitimate rights and interests of Chinese enterprises and create a good environment for enterprises in the two countries to work together to benefit both.

China needs the US due to overcapacity production

Wang Wentao has urged companies to tread carefully in the US by trying to preserve what remains of fragile economic ties. This is because he acknowledged the challenge of China’s exports surging into alternative markets.

As trade frictions with the US escalated, Chinese companies have increasingly redirected shipments to regions such as India, Africa, and Southeast Asia. These destinations have absorbed goods ranging from textiles to machinery and electric vehicles, helping offset lost sales to Western economies. 

Official data shows exports to ASEAN alone grew more than 7% year-on-year in the first quarter of 2025. This shows how quickly these markets are becoming vital outlets for the Chinese industry. Also, as reported by Cryptopolitan, China leads regional commerce, taking 20% of Southeast Asia’s exports and supplying 26% of its imports, compared with 16% for the United States. 

However, this strategy carries risks. Local industries in recipient countries are raising alarms that they cannot compete with Chinese manufacturers’ scale and pricing power. Analysts warn that a flood of low-cost Chinese products could destabilize domestic industries, spark political backlash, and fuel calls for trade protection. 

Southeast Asian textile makers, African steel producers, and Indian solar panel firms have all voiced concerns about being undercut by cheaper imports. Wang’s remarks highlight the tightrope Beijing is walking. It must manage domestic overcapacity by finding markets for its goods, while avoiding new conflicts with the US or backlash in developing economies. 

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