Uncertainty in Trade Tariff Impacts and Strategic Responses Through Trade Substitution: Empirical Evidence from Shandong

Abstract

Against the backdrop of growing uncertainty in the global trading system, enhancing regional economic resilience through alternative trade channels—particularly in response to tariff-induced disruptions and the protracted U.S.–China trade conflict—has emerged as a pressing issue for both policy and academic inquiry. This study integrates theoretical analysis with multi-scenario computable general equilibrium (CGE) modeling to rigorously assess the combined macroeconomic and sectoral impacts of U.S.–China trade tensions and the Regional Comprehensive Economic Partnership (RCEP) on Shandong Province. Drawing on these findings, the paper advances a set of forward-looking, evidence-based, and operationally feasible policy recommendations. The analysis indicates that regional economies should strategically harness industrial internet platforms and advanced digital technologies; strengthen institutional coordination—including interdepartmental governance and cross-sectoral industrial planning; and foster synergistic integration of “personal AI” and “physical AI” systems to enable flexible, scalable, and demand-responsive manufacturing. Moreover, policymakers must proactively cultivate diversified, non-traditional trade substitution pathways—such as nearshoring, third-country intermediation, and digital trade facilitation—to generate sustainable trade diversion effects; accelerate the reconfiguration of regional supply chain networks; optimize spatial industrial layouts; and advance inclusive, green, and technologically driven industrial upgrading. Collectively, these measures enhance adaptive capacity to domestic and international market volatility while reinforcing local agency within global value chains.