The 2025 Global Trade Pivot: Spain Deepens China Ties as U.S. Tariffs Rise

Spain made a bold move in global trade: Prime Minister Pedro Sánchez’s government doubled down on strengthening commercial ties with China – even in the face of U.S. warnings. This pivot comes on the heels of a new wave of U.S. tariffs under the revived Trump administration, a protectionist push that has upended the global trading order and spurred fears of recession. As Washington raises barriers, countries like Spain are looking east for growth opportunities, signalling a broader shift in trade strategy worldwide. International business executives, export managers, and growth-focused entrepreneurs are taking note: a new era of “sell in China 2025” might be upon us.

Europe Pivots East Amid U.S. Protectionism

Spain’s latest trade outreach to China is not an isolated case, but it is a telling one. Facing steep U.S. tariffs on European goods, Spain has openly defended closer trade links with China as being in its national and European interest. “We have excellent trade relations with China which we intend not only to continue having, but expanding,” affirmed Spanish Agriculture Minister Luis Planas during Sánchez’s Asia tour. That tour – which included Vietnam and a high-profile visit to Beijing – was timed “amid the global fallout of U.S. President Donald Trump’s tariff policy”, positioning Spain as a bridge between China and the EU. These sweeping U.S. trade tariffs have been described as “punishing” measures that “have upended the global trading order, raising fears of recession and wiping trillions of dollars off” major companies’ market value. In blunt terms, America’s go-it-alone approach is forcing allies to seek new partners.

Other European nations are also recalibrating. France’s President Emmanuel Macron, for instance, visited Beijing in 2023 to deepen economic ties, and Germany – despite talk of “de-risking” – remains deeply entwined with China. In fact, German companies have been doubling down on China: German foreign direct investment made up 57% of total EU investments in China in H1 2024 (driven largely by the auto industry). Berlin even voted against EU tariffs on Chinese electric vehicles in 2024, reflecting the influence of its carmakers’ dependence on the Chinese market. Europe’s pivot east is pragmatic. Leaders like Sánchez see engagement with Beijing as a way to attract investment and offset losses from the U.S. market. Since Sánchez signaled a more China-friendly stance last year (by reversing support for EU tariffs on Chinese EVs), China has confirmed major new investments in Spain – from battery giant CATL’s factory to green hydrogen projects. Europe’s message is clear: if Washington shuts the door, Brussels (and its member states) will open a window to Beijing. This shift is happening even as U.S. officials caution that leaning toward China is “cutting your own throat” – a warning Madrid has pointedly shrugged off .

Beyond Europe: Others Strengthen Trade with China

It’s not just Europe. Around the globe, many countries are seeking alternatives to the U.S. market for exporters and forging tighter partnerships with China. Brazil is a prime example. Under President Luiz Inácio Lula da Silva, Brazil has elevated its relationship with Beijing to what both sides call a “Community with a Shared Future” – effectively a strategic partnership. In late 2024, Xi Jinping and Lula signed 40 cooperation agreements across farming, energy, and infrastructure, expanding ties between two economies that already exchange over $150 billion in trade annually. “China-Brazil relations are now at their best moment ever,” President Xi proclaimed, heralding Brazil as a “strategic partner” in ensuring China’s long-term food and energy security. Concrete outcomes followed: for example, China opened its market to Brazilian exports like sorghum and sesame, and Brazilian food giant BRF announced a $43 million acquisition of a food plant in Henan, China. This deepening South-South cooperation shows how emerging economies are capitalizing on China’s vast market and investment flows, reducing reliance on the dollar (Brazil and China even struck a deal to settle trade in yuan and reais) and hedging against Western protectionism.

In Asia, many of China’s neighbors have also tightened economic bonds. Members of ASEAN, along with China, formed the world’s largest free trade bloc (RCEP), which came into force in 2022 – notably excluding the U.S.. Countries like Vietnam benefit from exports to the U.S. but simultaneously court Chinese trade and investment. (Sánchez’s Vietnam stop, notably, sought to strengthen ties with an ASEAN economy booming in part from supply-chain shifts out of China, yet still closely linked to China’s orbit .) Across the Global South, the pattern is evident: nations are engaging China to diversify their trade options. Geopolitically, this means Beijing’s influence is rising as it presents itself as a champion of free trade and multilateral cooperation, in contrast to Washington’s tariffs and sanctions. Economically, it means new opportunities for those ready to navigate a more China-centric trade landscape.

Geopolitical and Economic Implications of the Shift

This global trade realignment carries significant implications. Geopolitically, China is seizing the moment to expand its influence. As one Spanish trade official noted, “China will be trying to attract to its sphere of influence as many countries as it can”. By offering markets, financing, and partnerships, Beijing is building goodwill (or at least economic leverage) across Europe, Asia, Africa, and Latin America. U.S. allies are now increasingly walking a tightrope, balancing security alignment with Washington against economic alignment with Beijing. Europe, for one, is grappling with this balance – seeking a “key strategic partner” in China even as transatlantic ties fray over trade and technology disputes. If the U.S. continues down a unilateral, protectionist path, we could see a more fragmented global trading system: one where Washington, Brussels, and Beijing each lead parallel spheres of economic influence.

Economically, exporters worldwide face a new calculus. America’s tariffs raise costs for foreign firms and can provoke retaliation (as seen when China launched an anti-dumping probe into Spanish pork after EU tariffs on Chinese EVs). Supply chains that once flowed freely across North America, Europe, and Asia are being reconfigured. For global consumer brands and manufacturers, heavy dependence on the U.S. or EU now comes with higher risk. Many are actively seeking to diversify market exposure. This is why entering the Chinese market has become a strategic priority for growth-focused companies. In short, ignoring China is no longer an option for firms with international ambitions. The country is simply too large and too central to future growth. As Spain’s Economy Minister put it, “China would be a key strategic partner for Spain and Europe”, a sentiment now shared by a growing number of nations .

For multinational businesses, this shift means adapting strategies. Exporters who once relied heavily on U.S. consumers are rethinking their approach – from agribusiness firms in South America, to machinery exporters in Germany, to fashion brands in Italy. The U.S. market, while still huge, is becoming relatively less accessible and perhaps less lucrative when weighed against tariffs and slower growth. Europe’s consumer market, while open, is mature and growing modestly. In contrast, China and other emerging markets offer growth rates and scale that can offset Western headwinds. The bottom line: to hedge against geopolitical uncertainty, companies are spreading bets across a more multipolar marketplace.

Consequences for Exporters and Global Brands

What does this mean on a practical level for exporters and global consumer brands, especially those that built their fortunes in the U.S. and Europe? Several key consequences are emerging:

• Need for Diversification: Companies can no longer afford to “put all their eggs” in the U.S.-EU basket. Tariff swings, trade wars, or even regulatory shifts can suddenly constrain those traditional markets. Seeking alternatives to the U.S. market for exporters isn’t just prudent – it’s becoming essential. Many firms are turning to Asia, Latin America, and the Middle East to broaden their revenue base. Among these, China stands out due to its sheer scale.
• Margin Pressures and Pricing Shifts: Tariffs on exports to the U.S. force foreign brands to either absorb extra costs (hurting profit margins) or pass them to consumers (risking competitiveness). Some European luxury brands, for example, have quietly raised U.S. prices due to tariffs on certain goods. Likewise, American brands facing Chinese tariffs (in response to U.S. actions) find their products at a price disadvantage in China. These pressures encourage companies to localize production or invest in local partnerships to circumvent duties.
• Strategic Market Entry and Local Partnerships: Exporters pivoting to new markets must often adapt their go-to-market strategy. This might mean tweaking products to local tastes, navigating different e-commerce ecosystems, or complying with local regulations. Many global brands find that partnering with local experts or distributors is crucial, especially in complex markets like China (more on this shortly). The role of such facilitators has grown, giving rise to specialized firms that help foreign businesses operate abroad without heavy infrastructure of their own.
• Global Consumer Brand Rebalancing: Brands that once derived the bulk of their sales from North America and Europe are striving for a more balanced global spread. For instance, major consumer electronics and apparel companies are aiming to have a third of revenue from Asia-Pacific within a few years. This hedges against any single region’s downturn. It also reflects consumer trends – global consumer demand growth is now centered outside the West, largely in Asia.

In sum, exporters and brands that fail to pivot could see stagnation or decline, while those that embrace new markets stand to gain a second wind. Nowhere is this more evident than in China, which offers a compelling combination of high-growth consumer demand and an increasingly sophisticated retail landscape. Let’s examine why China is emerging as the strategic growth market of the 2020s.

China’s Consumer Market: The Strategic Growth Opportunity

China isn’t just the world’s factory anymore – it’s one of the world’s largest consumer markets, and by many measures the most dynamic e-commerce arena on the planet. Any discussion of “where next” for global growth inevitably turns to China’s shoppers. Consider these eye-opening stats and trends driving the China e-commerce opportunity in 2025:

• Scale of the Market: China is the #1 e-commerce market globally by a huge margin, generating over $3 trillion in online sales annually, which is more than half of all e-commerce worldwide. By comparison, the U.S. – the second largest market – sees about $1 trillion in online sales. In total, China boasts over 700 million digital consumers. In 2020, online retail transactions hit $2.29 trillion with 710 million digital buyers, and that was forecast to reach $3.56 trillion by 2024. Simply put, no other country offers this volume of potential customers accessible 24/7 via digital channels.
• Rising Middle Class & Consumer Trends: China’s middle class has expanded dramatically and continues to grow. By 2030, another 80 million Chinese will enter the middle class, adding to an already massive cohort of consumers with disposable income. Chinese consumers are increasingly seeking quality, premium brands (including foreign brands), and are savvy with digital and mobile shopping. Trends like health & wellness, luxury goods, and eco-friendly products are on the rise, driven by younger urban demographics. Crucially, consumer spending in China is rebounding after the pandemic years – the economy grew 5.2% in 2023 and 5.0% in the first half of 2024, buoyed by a revival in household consumption .
• Dominance of E-commerce Platforms: Retail in China has leapfrogged straight into e-commerce. Traditional brick-and-mortar is often bypassed in favor of apps and online marketplaces. Alibaba’s platforms alone handle around 50% of China’s e-commerce transactions. Alibaba’s Taobao and Tmall together command about 45% of total e-commerce gross merchandise volume. JD.com (Jingdong) follows with roughly 16% market share, and Pinduoduo with 13%. These platforms aren’t just large – they’re highly advanced in logistics, payments, and integration with social media. Live-streaming e-commerce, social commerce (via apps like Douyin/TikTok), and super-app ecosystems make China’s digital marketplace uniquely rich. For example, on Singles’ Day (11/11) – China’s biggest shopping festival – Alibaba’s platforms saw over $100 billion in sales in 24 hours in 2022, showcasing Chinese consumers’ spending power.
• Maturity of Tmall and JD.com: Two platforms stand out as critical gateways for foreign brands: Tmall and JD.com. Tmall, Alibaba’s premier B2C marketplace, has over 800 million buyers and 150,000 merchants on the platform. In 2022, Tmall’s gross merchandise value was near $600 billion – making it Asia’s largest B2C e-commerce site. Tmall’s reputation for quality and brand focus (strict anti-counterfeit measures, invite-only for brands, etc.) makes it synonymous with stability and maturity in e-commerce. Notably, Tmall Global (a specialized section) serves as “Tmall for foreign brands”, allowing companies without a local Chinese entity to sell directly to Chinese consumers by shipping from abroad into bonded warehouses. This has opened the door for thousands of international brands to test the market with relatively low risk.
• JD.com’s Tech-Driven Edge: JD.com, China’s other e-commerce titan, is known for its cutting-edge logistics and technology. JD built its own nationwide fulfillment network, enabling rapid delivery (often within 24 hours) across China. The company operates the largest fleet of delivery drones in the world and has automated warehouses, giving it unrivaled control over supply chain. JD’s direct retail model (it buys and sells products itself, unlike Tmall which is a pure marketplace) led it to achieve ¥1.08 trillion in revenue in 2023 (about $153 billion), even surpassing Alibaba in direct e-commerce revenue. For consumers, this means trust in authentic goods and speedy service; for brands, JD offers a one-stop logistics solution if they partner with the platform. Together, Tmall and JD.com represent a mature, highly scalable infrastructure where foreign brands can reach Chinese buyers at an unprecedented scale. The China e-commerce opportunity is not a distant promise – it’s a current reality, with infrastructure and consumer readiness already in place.

Given these conditions, it’s little wonder that global companies are flocking to enter the Chinese market. From Nike to L’Oréal to Tesla, foreign brands that cultivate a strong China presence have become success stories, often offsetting dips in Western markets with growth in China. However, cracking the China market is not plug-and-play – it requires local knowledge, careful strategy, and often a helping hand. This is where specialized market entry partners come into play.

Gate Kaizen: A One-Stop Partner to Enter and Scale in China

For businesses determined to expand in China, partnering with experts on the ground can make all the difference. Gate Kaizen is one such service provider that has emerged as a valuable ally for global brands looking to “enter Chinese market” and achieve scalable growth without flying blind. In essence, Gate Kaizen offers a one-stop solution to help companies launch, operate, and expand in China – handling the heavy lifting so that you can focus on your product and strategy.

Gate Kaizen’s model is akin to having your own local China team, but outsourced. Gate Kaizen acts as a one-stop partner with a full local team (experts in logistics, warehousing, customs, e-commerce, and branding). By joining, you can import and distribute in China without a local entity – the platform handles key operational tasks from customs clearance and storage to deploying local sales support.

In practice, this means a foreign exporter doesn’t need to set up a Chinese subsidiary or sign away control to a distributor; Gate Kaizen can be the Importer of Record, manage your shipments through Chinese customs, warehouse your goods, and even run your online stores and sales force. Here are some practical examples of how Gate Kaizen supports companies in China:

• Tmall Store Setup & E-commerce Management
• Logistics & Supply Chain Support
• Local Sales Agents & Offline Distribution
• China-Specific Growth Strategy & Ongoing Consulting

Embracing a Borderless Growth Mindset

The world of 2025 presents a stark choice for export-driven businesses and global brands: adapt to the new trade realities or fall behind. With the U.S. adopting a more insular trade stance – raising tariffs and prioritizing domestic industry – and with Europe cautiously balancing between allies and opportunities, the gravitational pull of China’s market has grown impossible to ignore. Countries like Spain have read the tea leaves and acted, reinforcing commercial bridges to the East even as political winds shift in the West. They are not alone. From Germany’s auto giants investing billions in Chinese EV ventures, to Brazil striking landmark deals with Beijing, to ASEAN economies binding themselves into Asia-led trade networks, the global shift toward China is well underway.

For international business leaders, the takeaway is clear and energizing: China represents a vast, dynamic frontier for growth – one that can complement and, in turbulent times, compensate for Western markets. Tapping into this opportunity requires more than just ambition; it demands cultural savvy, local partnerships, and a willingness to innovate outside your comfort zone. The good news is that today’s business environment offers more support than ever to make this leap. E-commerce platforms have matured to welcome foreign sellers, logistics networks can deliver your product from Shenzhen to Sichuan in a flash, and partners like Gate Kaizen stand ready to localize your operations seamlessly. In many ways, it has never been easier for a determined company to “enter Chinese market” and find success, provided they do their homework.

As we look ahead, the global trade landscape will likely become more multipolar. Smart entrepreneurs and export managers will hedge their bets, seizing the upside of both East and West. The brands that flourish will be those that treat China not as an ‘alternative’ market, but as a core market integral to their strategy – right alongside the U.S. or EU. They will innovate for Chinese consumers, engage on Chinese platforms, and integrate China into their company DNA. In doing so, they’ll future-proof their growth against protectionist shocks elsewhere.

The year 2025 may well be remembered as a turning point when the world’s economic center of gravity tipped decidedly eastward. For those in the business of selling products and building brands globally, the message is: keep your eyes east, your mind open, and your strategy agile. The gate to China’s opportunity is wide open – and it’s time to walk through. With the right approach (and the right partners), “China e-commerce opportunity” can move from buzzword to bottom-line reality. In a climate of change, embracing this borderless growth mindset is not just wise – it’s essential for thriving in the new age of global trade.