Xi’s Strategic Moves in the Indo-Pacific Challenge US Alliances Amid Trump’s Shift in Priorities

By Bloomberg News
Mar 26,2025 (Bloomberg) – President Xi Jinping is stepping up China’s influence in the Indo-Pacific as Donald Trump diverts his focus elsewhere. From conducting unprecedented military exercises off Australia’s coast to deploying a record number of surveillance balloons near Taiwan, Beijing is intensifying its assertiveness in the region. Additionally, China has issued stern warnings to Tokyo regarding any perceived support for Taiwan’s independence.

Trump’s recent overtures toward Russia and skepticism about NATO have raised doubts about America’s reliability as a security ally in Asia—a role it has played for decades against Beijing’s ambitions. The former president has urged Taiwan to increase its defense spending and questioned existing security agreements with Japan, suggesting that while the U.S. must protect them, they owe no such obligation in return. He also imposed tariffs on allies like South Korea and Australia.

For Xi, this moment presents an opportunity to exploit cracks in U.S.alliances while navigating Trump’s hefty tariffs on Chinese goods—now at 20%. Chinese officials are carefully calibrating their rhetoric towards Asian nations to avoid triggering U.S. retaliation; they’re vocal about Taiwan but are holding back on large-scale military drills around the island.

“the Chinese government is testing boundaries everywhere,” noted Bill Hayton from Chatham House. “They’re pushing limits but will reassess when faced with pushback.”

China’s actions reflect a broader strategy aimed at discouraging countries from aligning too closely with the U.S., notably regarding sensitive topics like territorial claims over Taiwan and issues surrounding ethnic minorities within China.

During his presidency, Joe Biden worked hard to strengthen American ties in Asia as part of a strategy to counter China’s rise—this included high-profile summits with leaders from South Korea and Japan and expanded military cooperation with the Philippines amid maritime disputes involving both nations.

Biden also broke away from previous ambiguity by stating he would defend Taiwan against any potential invasion by China—a significant shift from past policies that neither confirmed nor denied military intervention possibilities.

As Trump prepares for another round of tariffs set for april 2, Defense Secretary Pete Hegseth will visit key partners like Japan and the philippines this week. While he’ll emphasize ongoing U.S. support, he’s likely also going to echo Trump’s call for increased defense budgets among Asian allies.

“Trump’s administration prioritizes trade policy above all else,” explained Josh Lipsky of the Atlantic Council’s GeoEconomics Center. “In contrast, Biden focused more on national security concerns regarding China.”

Asian nations are cautiously adjusting their strategies amidst Trump’s new approach toward international relations.

When asked if Australia would retaliate against China’s naval maneuvers near its waters last year, Prime Minister Anthony Albanese highlighted that one out of four Australian jobs relies heavily on trade—with China being a crucial partner.

Thailand recently justified deporting Uyghurs back to China as necessary action against potential backlash from Beijing—a move criticized by some members of Congress who argue it endangers human rights protections.

This willingness by China to challenge U.S.-aligned countries marks a stark contrast compared to pre-Trump diplomatic efforts when Beijing sought warmer relations with Australia and India after years of tension along their border.

Drew Thompson from Singapore’s S.Rajaratnam School pointed out that while warming ties may seem contradictory given current tensions over security matters, there appear to be differing opinions within Beijing about how best to achieve national goals—whether through force or diplomacy remains unclear.

Both sides are adapting their diplomatic strategies; during recent talks between Republican Senator Steve Daines and Chinese officials in Beijing focused primarily on trade rather than contentious political issues—an approach previously uncommon among American lawmakers who often confronted Communist Party leaders directly over sensitive topics like human rights violations or international conflicts involving Israel or Hamas.While Trump aims not just at maintaining influence but regaining control over strategic assets globally—including places like panama—the shifting dynamics could play into Xi’s hands during future negotiations where demands might center around reducing tensions concerning taiwan.