Donald Trump’s second term started positively for U.S.-China relations, offering Beijing relief. The president softened his hardline stance by delaying threats to impose hefty tariffs on Chinese goods, signalling a willingness to engage in dialogue.
At the World Economic Forum in Davos, Trump hinted at a potential ‘perfect relationship’ with China and expressed interest in visiting Beijing in the coming months. Trump granted a 75-day reprieve to TikTok, signalling openness to revisiting harsh measures against Chinese firms.
This marks a welcome change for Beijing, which had braced itself for a repeat of Trump’s first-term trade war. “China realises there’s an opportunity to negotiate with Trump… a better U.S.-China relationship is more important to China than the U.S.”, said Liu Dongshu, a political scholar at the City University of Hong Kong.
Understanding the Current Trade Tensions
The stakes are high for China, whose export-driven economy remains fragile.
A trade war, like the one during Trump’s previous administration, could have devastating consequences. Chinese President Xi Jinping has seized the opportunity for diplomacy, calling for a new starting point in U.S.-China ties during a pre-inauguration call with Trump. Vice President Han Zheng attended Trump’s swearing-in ceremony—the highest-ranking Chinese official ever—signalling Beijing’s desire for constructive engagement.
At Davos, Vice Premier Ding Xuexiang struck a conciliatory tone, pledging that China wants to “promote balanced trade” rather than maintain a surplus—directly addressing one of Trump’s key grievances. However, Beijing remains cautious. As Shanghai-based foreign affairs analyst Shen Dingli noted, China sees this as an opportunity to “smile, stay calm, and start talking” while carefully calculating its moves.
Trade Policy & Existing Agreements
The 2020 ‘phase one’ trade deal remains a focal point in Trump’s trade policy. The deal, which marked a truce in the first trade war, is under review in an executive order signed on Trump’s first day back in office. The outcome of this review will guide whether new tariffs will be imposed on Chinese imports. The process gives China valuable time to strengthen ties and avoid severe economic penalties.
Despite the optimism, challenges persist. U.S. lawmakers criticise Beijing on issues like human rights, military expansion, and territorial aggression in the South China Sea. Bipartisan support for stricter policies against China remains firm in Congress, as evidenced by the recent introduction of a bill to revoke China’s preferential trade status.
Xi Jinping has cautioned against overconfidence, emphasising that “respect for each other’s core interests” is key to stability—especially regarding Taiwan, a sensitive issue for Beijing. Even within China, scepticism remains about the durability of Trump’s current tone.
‘This does not mean that the China-U.S. relationship is any easier; it’s just that the U.S. approach has changed,’ said Jin Canrong, deputy director of the China-U.S. Research Center at Renmin University. ‘We must not let our guard down … the U.S. still views China as a strategic rival.’
While Trump’s early moves suggest a softer approach, the question remains: how long will this diplomatic reprieve last?
Article Reference: CNN
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