Donald Trump’s plan to reform the US government in his second term has raised concerns in China, with experts warning that these changes could pose a significant challenge to Beijing. Zheng Yongnian, a prominent policy advisor and academic, said the proposed restructuring, led by Elon Musk and Indian-origin entrepreneur Vivek Ramaswamy, might create a more competitive US political system, pressuring China to adapt.
Speaking at the Baichuan Forum in Shenzhen, Zheng, dean of the School of Public Policy at the Chinese University of Hong Kong, said, “A more efficient US political system would put huge pressure on China’s current system.” He characterized the potential reforms as “state capitalism with American characteristics.”
Department of government efficiency
Trump has named Musk and Ramaswamy to lead a new Department of Government Efficiency (DOGE), which aims to streamline governance by eliminating thousands of regulations and reducing the federal workforce.
“In the medium to long term, the greatest pressure on China may come from changes within the US,” Zheng said, cautioning against underestimating the impact of institutional reforms driven by figures like Musk.
China prepares for Trump 2.0
China is bracing for Trump’s return to the presidency on January 20, with expectations of heightened tensions over trade, Taiwan, and the South China Sea. Trump has signaled plans to increase tariffs by 60% on Chinese goods and enforce tougher measures against Beijing.
To counter US pressures, China has introduced policies to support its export sector and reduce reliance on Western markets under its “dual circulation” strategy. Zheng suggested expanding China’s openness to US capital and citizens, emphasizing that the competition between the two nations revolves around “who is more open.”
Despite the anticipated challenges, Zheng downplayed the risk of military conflict, stating, “He [Trump] does not want to go to war with China,” even as tensions around Taiwan and the South China Sea are expected to escalate.
China, Zheng concluded, must accelerate domestic reforms to remain competitive, asserting confidence in Beijing’s ability to outperform the US in the long term.