Global economy is on the move away from Trump and towards China

The geopolitical tectonic plates are on the move again, and the early tremors are already visible across the global landscape, with significant consequences for traditional alliances, global markets, and national power realignment.

What we are seeing unfold during the first quarter of 2026 increasingly feels like one of those historical earthquake moments, not because of any single headline associated with President Donald Trump, or a single moment like Canadian Prime Minister Mark Carney’s “rupture” in the world order speech at Davos, or any one bilateral meeting or state visit. But taken together, along with the cumulative weight of high-level diplomatic gambits to Beijing now underway — and many more on the horizon — something structural is happening that requires attention. 

For markets and policymakers alike, the diplomatic foot traffic tells a striking story: the world is returning to China. 

This is not without precedent. In the years following China’s accession to the World Trade Organization in 2001, global leaders and corporate executives made annual pilgrimages to Beijing, much like those made by eager statesmen and traders during the Qing Dynasty, drawn by the promise of market access, manufacturing skill, production scale and scope, and the sheer velocity of Chinese GDP growth at the time. That gravitational pull extended through much of Xi Jinping‘s first five-year term, when China still projected the promise of profits and opportunity more than political constraint and economic contraction. 

The momentum shifted dramatically in the years leading up to, and especially after, the pandemic. Supply chain shocks, coercive trade practices, intellectual property theft, data restrictions, human rights focus, and intensifying geopolitical rivalry hardened Western posture toward Beijing. The language of “de-risking” and “decoupling” migrated from policy circles in Washington into boardrooms in the U.S. and Europe. Diplomatic traffic did not cease, but it slowed markedly as governments and firms recalibrated exposure to what was increasingly viewed as both geopolitical rival and economic competitor. 

What makes the current moment so striking is that the drift now appears to be reversing, cautiously and without the overexuberance that defined the post-WTO era. The catalyst for this shift is not a transformation in Chinese governance or economic structure, political systemic change, or how Beijing itself views the West. As difficult as it is for many in Washington to admit, it is a growing perception of volatility emanating from Washington itself, an uncomfortable realization for the U.S. national security establishment, and an even harder one for allies to process. 

The realignment became particularly visible at Davos, where Trump openly mocked French President Emmanuel Macron, criticized Canada for insufficient gratitude, and dismissed NATO as a money pit. His incorrect assertion that NATO allies had not served on Afghanistan’s front lines, later walked back, reinforced a broader perception that times and realities had shifted. But the contempt for Europe did not begin there. It has been building since Vice President JD Vance’s blistering address at last year’s Munich Security Conference, where European partners were publicly castigated. Since then, the tone shift has reverberated across European capitals. 

Public opinion data suggests this paradigm shift is not being received lightly. In Germany, recent polling indicates that 71% of respondents now view the United States as an adversary, while continent-wide surveys show only 16% still describe the U.S. as an ally. These figures signal more than frustration; they represent a recalibration of allied risk perception. Risk is one of the most consequential currencies in geopolitics, and Washington has spent years constructing an elaborate risk architecture around China. Now that architecture appears to be turned on its head. 

European leaders and the ‘middle power’ imperative

Beijing did not engineer this paradigm shift, but if it plays its cards right, it is positioned to benefit from it. Over the past year, a steady procession of allied leaders has made its way to China. Each visit has been grounded in national economic self-interest, and while trust in China may be limited, reliance on Washington now feels less certain — more to the point, riskier. 

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