As the dust begins to settle after a less than two-hour meeting between Chinese leader Xi Jinping and US President Donald Trump at an air base in South Korea this Thursday, it is clear that Chinese leaders have achieved yet another victory with their aggressive strategy towards the United States.
The meeting did not guarantee a comprehensive trade deal, but rather a return to a shaky truce based on a few agreements intended to keep the relationship stable as the two sides move toward a deal.
Xi walked away with a 10% reduction in Trump’s recently imposed 30% tariffs on Chinese goods this year – in exchange for stepping up efforts to rein in its role in the US fentanyl crisis. He also secured U.S. agreement to suspend a new rule that would have greatly expanded the number of Chinese companies blacklisted from purchasing sensitive American technology.
Trump prevented Beijing from imposing an expanded set of restrictions that could have harmed global industries dependent on China’s rare earth minerals. China will also increase purchases of U.S. soybeans and other agricultural products, U.S. officials said. Both sides have also suspended port fees affecting each other’s shipping sectors and will extend the truce on higher tariffs.
On paper, it seems like a reasonable tradeoff — and one that, at least for now, offers what both leaders (and the global economy in general) wanted: stability after an intense year of disputes between the world economic heavyweights.
But for Beijing, the agreements — which were accompanied by Trump’s effusive praise for Xi — are also a clear confirmation of the success of its strategy in dealing with Trump 2.0.
This is because Beijing has managed to obtain valuable concessions on tariffs and export controls, while mostly conceding measures that were taken in the first place only as retaliation against US measures.
Take soybeans, an important American export whose purchases by China have fallen sharply this year due to trade tensions.
China has agreed to buy at least 25 million metric tons of American soybeans annually over the next three years, U.S. Agriculture Secretary Brooke Rollins said after the talks.
But that target is still 1.8 million metric tons lower than China’s soybean purchases last year before the tensions, according to U.S. data.
China’s highly nationalistic and censored internet took note of all this this Friday, when social media commentators praised how “China really nailed this tariff war” and noted that “Trump has finally dealt with the mess he created.”
China’s plan
The outlook is not entirely optimistic for China.
Even though tariffs from this year’s US trade dispute have been reduced to 20%, Chinese exporters still face what, on average, amounts to almost 50% duties on their products, including pre-existing taxes. This fee remains among the highest imposed on any country by the US. Meanwhile, Washington has seen real progress on its goal of reducing the trade deficit.
And although the deal has not yet been signed, Beijing may have made some real concessions over the fate of the social media app TikTok, after changing its stance from staunch opposition to a US law requiring ByteDance, the app’s Chinese owner, to sell its US business.
China also remains blocked from accessing cutting-edge American chips, a key weapon in the high-stakes race for artificial intelligence taking place between the two countries.
But in the technology field, Beijing’s ability to delay for at least a year the new American rule that would have greatly expanded the number of Chinese companies blacklisted from purchasing sensitive American technologies is a huge boon for Chinese companies.
The now-suspended U.S. initiative to close loopholes could have affected about 20,000 more companies than those already on the list, according to an analysis by business intelligence firm WireScreen.
This is yet another victory for Beijing’s strategy of using its near-total control over the global rare earths supply chain as leverage against the US — a tactic it also employed during a tariff escalation earlier this year.
And on China’s side, agreeing to delay for at least a year its expanded export control regime for rare earth minerals, billed as retaliation for the expansion of the US blacklist, is unlikely to be seen as a major setback in Beijing.
As Chinese scholar and foreign policy analyst Shen Dingli told CNN earlier this month, these measures were a “nuclear” option that Beijing knew was not symmetrical — “but if China doesn’t use this weapon, it will have little to negotiate with.”
Whether Xi and Trump can maintain detente as they work toward a broader agreement and planned visits to each other’s countries in 2026 is the next big question.
After all, Canada knows firsthand that a trade truce reached with Trump could quickly collapse.
A series of obstacles, predictable and unexpected, in the expansive rivalry between the US and China could jeopardize the newfound stability — and any deal that is reached is unlikely to resolve the deep-rooted structural issues between the two countries.
But when Trump took off from South Korea’s Gimhae International Airport on Thursday to return to a US mired in a government shutdown and Xi remained in the country to attend an international summit and promote China as a beacon for globalization, it was clear that the balance of power between the two had shifted.
