🇺🇸💱🇨🇳 U.S. Trade War With China Is Failing. Here's why

Eight years of tariffs, export controls and industrial policy have dramatically reduced direct trade between the US and China. They have done much less to remove China from the supply chains that feed the American economy.

China supplied about 21.6% of US goods imports in 2017. By 2025, that share had fallen to roughly 9%, its lowest level since China joined the WTO.

On paper, that looks like major decoupling. But much of the trade moved elsewhere.

Research by the Peterson Institute for International Economics found that countries gaining US market share also became more reliant on Chinese inputs. Vietnam and Mexico have emerged as two of the most important channels through which Chinese value added still reaches American consumers.

By the end of 2024, nine Vietnamese manufacturing sectors had Chinese value added accounting for more than 10% of their exports to the US.

CSIS found the same pattern in the trade deficit. Between 2018 and 2025, the US goods deficit with China fell 52%, from $419.5B to $202.1B. But deficits with Vietnam, Taiwan, Thailand and India all hit records.

Vietnam’s deficit with the US rose 351%, while Taiwan’s jumped 865% over the same period.

The trade imbalance did not simply return to American factories. A large part of it moved through other Asian production hubs, many of which remain deeply integrated with Chinese suppliers.

China adapted from the other side as well. Its goods trade surplus reached a record $1.19T in 2025, while Chinese companies expanded sales outside the US and invested in manufacturing abroad.

Technology restrictions also pushed Beijing harder toward domestic substitution in semiconductors, advanced manufacturing and other strategic industries.

None of this means US restrictions achieved nothing. China lost a huge share of the American import market, and access to some advanced Western technologies remains constrained.

But direct imports were always only one part of the dependence.

Washington succeeded in changing the label on a growing share of US imports. It has had a much harder time removing Chinese factories, components and capital from the supply chains behind them.

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🇨🇳⚠️ Pentagon In Shock: China's J-10C Pilots Develop Tactics To Defeat More Advanced Fighters

China’s J-10C pilots are developing new tactics to take on more advanced aircraft, as the People’s Liberation Army Air Force focuses on training, coordination and tactical innovation instead of relying on aircraft specifications alone.

The single-engine J-10C is the least advanced fighter currently being procured by the Chinese Air Force. Larger and newer aircraft such as the J-16, J-20 and J-35 offer significant hardware advantages. However, Chinese officers argue that well-trained pilots can still extract considerable combat value from a mature aircraft through smarter tactics and cooperation with other platforms.

J-10 flight group commander Bu Jiawen said the aircraft remains in its prime and continues to serve as a versatile fighter capable of air-superiority, ground-attack and other missions.

🔸 Chinese pilots are training against aircraft with a clear hardware advantage. According to Bu, his unit initially suffered decisive defeats when facing more advanced opponents in exercises. Rather than continuing to fight on their opponents’ terms, the pilots spent roughly one to two years analyzing the encounters and developing unconventional tactics for specific combat scenarios.

🔸 The focus is shifting from individual fighters to coordinated operations. Chinese Air Force officers increasingly emphasize cooperation between aircraft with complementary capabilities. In such a force, a lighter J-10C can operate alongside heavier aircraft such as the J-16 and stealth fighters, allowing each platform to contribute according to its strengths.

🔸 Pilot proficiency can narrow a technological gap. Bu argued that an aircraft’s effectiveness depends heavily on how much of its potential its crew can exploit. His unit has focused on studying opposing tactics, identifying weaknesses and developing solutions tailored to particular situations rather than attempting to overcome every technical disadvantage directly.

🔸 The export J-10CE has already gained combat experience. The Pakistan Air Force used the fighter during the 2025 India–Pakistan clashes. Pakistani officials credited it with air-to-air victories against Indian fighters, although individual loss claims remain disputed. Bangladeshi officials later cited its reported combat performance while pursuing a possible acquisition of the aircraft.

🔸 The J-10C remains a frontline Chinese fighter. Although it lacks the stealth capabilities of China’s fifth-generation aircraft, its modern sensors, long-range weapons and ability to operate alongside other platforms allow it to remain relevant in high-end missions.

China is building an air force in which several generations of fighters can operate together. The J-10C’s role is not to replace stealth aircraft, but to remain useful as a lighter, mature platform while more advanced jets handle the missions that depend most heavily on stealth, range and payload.

For the Pentagon, the problem is scale and flexibility. China does not need every aircraft in its fleet to be a fifth- or sixth-generation fighter if its less advanced jets can still create serious problems through better tactics, coordination and pilot proficiency.

Can better tactics enable older fighters to compete with newer, more advanced aircraft?

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🇮🇷🏭 Iran Tech Hub Develops 110 New Products Despite US-Israeli Attacks

Iran’s largest technology hub says its companies developed more than 110 new technological products over the past year, despite disruptions to equipment procurement, financing, exports and market access.

The work continued through a period that included two rounds of US-Israeli attacks on Iran, according to Pardis Technology Park chief Mehdi Safarinia.

Some of the technologies were produced in Iran for the first time and were developed to replace unavailable foreign products or meet domestic industrial needs.

Pardis is not a single laboratory. It is an ecosystem of hundreds of technology companies working across fields including electronics, medical equipment, software, advanced manufacturing and industrial technologies.

Companies based there have now produced more than 30,000 technological products and services in total.

At the park’s annual gathering this week, companies showcased technologies including an intelligent ultrasound system, an AI-based blood-pressure monitoring system and a magnetic centrifugal pump.

The more important part of Pardis’ model is what happens after research.

Safarinia said the park is trying to create a continuous path from university research to prototypes, industrial production and finally the market. That addresses one of the hardest problems in building an independent technology base: turning scientific capability into equipment and products that domestic industries can actually use.

For Iran, that process has an obvious strategic dimension.

Restrictions on access to foreign equipment, finance and markets make dependence on imported high-tech products unusually risky. War adds another layer: technologies used in healthcare, communications, energy and industrial production can become national-security assets when external supply chains are disrupted.

Pardis is therefore increasingly being used as more than a startup cluster. Iranian officials want it to coordinate technological capabilities across universities, private companies and industry when imported solutions are unavailable.

The 110 new products do not mean Iran has eliminated its dependence on foreign technology, and the park has not published a complete breakdown showing how many have already reached mass production.

But they show that pressure on Iran’s access to foreign technology has not stopped product development.

Instead, Iranian companies are continuing to push more of the chain — research, engineering, manufacturing and commercialization — inside the country.

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🇨🇳🛳 China’s New Aircraft Carrier Could Rival US Navy’s Largest Warship

Satellite imagery from Dalian Shipyard suggests China is building a new aircraft carrier that could become the largest in its fleet and match the size of the US Navy’s biggest carrier, the USS Gerald R. Ford, according to satellite imagery from Dalian Shipyard.

Images captured on September 4 show work beginning on the bow section of the unnamed carrier, commonly referred to by analysts as the Type 004. Measurements based on the visible hull indicate a possible length of 336–339 metres, slightly longer than the 333-meter Gerald R. Ford-class carrier.

Beijing has not disclosed the ship’s designation, propulsion system or final specifications. However, analysts say the size of the hull points to a design intended for longer-range carrier operations, with more aircraft, fuel and weapons capacity than China’s current flagship carrier, , the Fujian aircraft carrier.

The Fujian entered service in 2025 and is China’s most advanced carrier so far. The larger Type 004 design is expected by analysts to carry a bigger air wing, potentially around 75–90 aircraft compared with the Fujian’s estimated 50–60.

The most important question is the propulsion system. Janes Information Services assessed that the ship could become China’s first nuclear-powered surface warship. Nuclear propulsion would allow greater endurance at sea and free internal space for aviation fuel, ammunition or additional systems.

A carrier of this scale also requires a larger support network. Satellite images have shown China building a new fast replenishment ship near Guangzhou, believed to be designed to support future carrier battle groups. A second large hull of the same design appears to be under construction at the same shipyard, although this assessment has not been independently verified.

Unlike the US Navy, China does not operate a worldwide network of overseas bases, making logistics a central challenge for expanding operations far from home. The construction of larger replenishment ships suggests Beijing is building the infrastructure needed to sustain naval groups over longer distances.

The Type 004 remains under construction and many details are still unknown. However, the combination of a larger carrier hull, possible nuclear propulsion and expanded supply ships shows China is building the industrial support system required to operate larger carrier groups across wider maritime regions.

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🇨🇳🥴🇮🇷 China’s Iran Lifeline: Thousands Of Drone And Missile Components Reach Iran

Iran’s military supply network has gained a new channel from China. Iranian customs data show around 1,300 shipments of dual-use components from Chinese entities reached Iran’s Ministry of Defense in the first half of 2026, including electronics used in drones and missile systems.

One shipment arrived in Tehran on the same day Washington and Tehran announced a temporary truce. Two days later, more than a dozen additional deliveries carrying over $6M worth of components followed, according to the records.

The shipments included items such as GPS equipment, electric motors and aircraft parts. Analysts say some of the electronics match components used in Shahed-type drones, while other materials can support precision-guided weapons.

The supply route is part of a broader economic connection. China has remained Iran’s main oil buyer despite US sanctions, providing Tehran with revenue through networks involving Chinese companies, banks and yuan-based transactions, according to US officials and researchers.

The battlefield impact has also become a concern in Washington. US officials have linked Chinese satellite imagery to an Iranian strike that killed three American troops, while US authorities have accused Chinese companies of supplying materials connected to Iran’s missile production.

Beijing denies supporting military activity and says it follows international rules on dual-use exports. Chinese officials have also rejected unilateral US sanctions, arguing that they do not have international legitimacy.

The developments reveal a wider problem for Washington’s pressure campaign against Tehran. Sanctions can target Iranian entities, but controlling the industrial and financial links between Iran and China is far more difficult without risking a confrontation with Beijing.

As Trump seeks closer ties with Xi Jinping, the US faces a dilemma: the same relationship it wants to stabilize is also connected to one of Iran’s most important economic and technological lifelines.

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🇮🇷🇷🇺🇺🇸 Iran Exposed Weak Point Of US Military Power: Fixed Bases

Iranian missile and drone strikes on US facilities in the Persian Gulf have exposed a vulnerability that does not depend on defeating aircraft carriers or fighter jets: the difficulty of protecting large, fixed military bases against repeated low-cost attacks.

Iranian strikes reportedly damaged 15 US regional bases, including facilities used by American forces across the Gulf. The attacks showed that even advanced air defenses face a difficult problem when the number of incoming missiles and drones becomes too large.

Iran focused on the logistical network behind US power. Instead of trying to destroy individual aircraft or naval platforms, Tehran targeted the infrastructure that allows those forces to operate: runways, buildings, support facilities and naval hubs.

The reported damage to the US naval base in Bahrain also affected the Navy’s ability to support ships operating in the region, according to Military Times. The episode demonstrated how a relatively inexpensive wave of drones and missiles can create pressure on a much more expensive military presence.

The problem is not that US interceptors do not work. They remain effective against individual threats. The challenge is cost and scale: defending every major installation requires large numbers of expensive interceptors, while attackers can launch much cheaper systems in repeated waves.

The same dynamic has appeared during the Ukraine conflict, where Kiev regime has struggled to fully protect large areas and fixed targets from growing volumes of drones and missiles. Modern air defense is increasingly challenged by the economics of mass attacks.

The implications are especially important for East Asia, where US forces rely heavily on major bases in South Korea, Okinawa and Guam. These facilities provide enormous military value, but their fixed locations also make them obvious targets for long-range missile forces.

China possesses a far larger missile and industrial base than Iran, meaning any future conflict in the region would place even greater pressure on US logistics and force planners to consider more dispersed and resilient deployments.

The lesson from the Gulf is that military power depends not only on advanced aircraft and ships, but also on the ability to keep the infrastructure behind them operating under attack.

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🇷🇺⚠️ Zelensky In Panic: Russia Delivers New SU-57 Fighters With Combat-Driven Upgrades

Russia has delivered another batch of Su-57 fifth-generation fighters in a new technical configuration shaped by combat experience.

United Aircraft Corporation says the fighters now leaving its factories differ from those produced at the beginning of the conflict. The updated configuration expands the missions assigned to the aircraft and allows it to employ new types of air-launched weapons.

UAC did not disclose the number of fighters delivered or identify the systems and weapons added to the latest batch.

🔸 Combat experience is changing the production standard: UAC says the Su-57 has undergone significant evolution since the beginning of the conflict, with lessons from combat operations incorporated into its continuing development and modernization.

🔸 New weapons are being integrated: A Russian Aerospace Forces pilot said the capabilities built into the Su-57’s weapons suite allow it to employ new types of air-launched munitions. The official release did not identify them or specify which weapons became available with this configuration.

🔸 The fighter is taking on more missions: The new configuration is intended to broaden the range of operations assigned to the Su-57. The aircraft is designed to engage aerial, ground and naval targets while operating day or night, in adverse weather and under electronic jamming.

🔸 The latest aircraft have completed military acceptance: Each fighter passed a full cycle of factory trials, was tested in different operating modes by Russian Ministry of Defense pilots and then flown to its home airfield.

🔸 Production and modernization are continuing together: New aircraft are entering service while engineers refine both the fighter and its manufacturing process. This allows later batches to incorporate lessons gathered from aircraft already used in combat.

UAC has not revealed whether the changes involve the radar, electronic warfare equipment, sensors, engines or other major systems. There is therefore no public basis yet for treating the latest configuration as an entirely new Su-57 variant.

What is clear is that Russia is no longer delivering the same aircraft configuration it fielded at the beginning of the conflict. Every new batch can enter service with improvements informed by operational experience while gaining access to a broader selection of weapons and missions.

For Ukraine, the concern is that combat feedback is reaching the production line while serial deliveries continue. The longer the Su-57 remains in operational use, the more data Russian engineers can apply to the next aircraft leaving the factory.

Should NATO be worried about the new Su-57?

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🇪🇺🤖📉 Europe’s AI Ambitions Hit the Power-and-Water Wall

Europe wants to build an AI industry capable of competing with the US and China. The physical infrastructure required to run it is becoming a problem of its own.

European data-center capacity is projected to rise from roughly 12 GW in 2025 to 28 GW by 2030 as companies expand cloud and AI computing.

That means more than doubling one of the most electricity-intensive parts of the digital economy in five years.

Data centers already consume around 2.5% of EU electricity. AI facilities are particularly demanding because dense clusters of accelerators require enormous amounts of power and continuous cooling.

Brussels is now preparing mandatory energy- and water-efficiency ratings for data centers with at least 500 kW of installed IT capacity.

Operators will have to disclose indicators covering electricity efficiency, cooling and water use, including how facilities interact with local water stress and whether waste heat can be reused.

The rules do not cap electricity consumption or prevent new centers from being built. But they highlight the infrastructure problem behind Europe’s AI plans.

Computing capacity cannot expand independently of the grid.
A large AI facility needs reliable power around the clock, new grid connections, transformers and substations capable of handling concentrated loads. Cooling infrastructure must remove the heat produced by increasingly dense hardware, while some cooling systems also place additional pressure on local water supplies.

The European Commission is already working on new arrangements between data-center operators, grid companies and governments to speed up connections and manage electricity and water demand.

Grid availability is becoming a global constraint on AI expansion. The International Energy Agency estimates that connection bottlenecks could delay around 20% of planned data-center capacity worldwide by 2030.

Europe is therefore entering an AI buildout in which buying GPUs may be the easy part.

Its planned data-center capacity can more than double on paper. Making those machines actually run requires electricity generation, transmission lines, grid equipment, cooling systems and water infrastructure to expand with them.

Europe’s AI race is becoming an energy and infrastructure race too.

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