President Trump and his aides are raising the stakes ahead of U.S.-China negotiations. The question is whether they will happen — and when
On March 4, the White House announced that it would double import tariffs on all Chinese goods (from 10 to 20 percent). The rationale is that China has not taken sufficient measures to combat illegal shipments of the narcotic fentanyl to the United States. Recall that the U.S. administration imposed the 10 percent tariff in early February for the same reason. In response, China immediately retaliated by imposing tariffs of 10 and 15 percent on certain categories of American imports, albeit with a delay. At the time, the announced negotiations between U.S. and Chinese leaders did not take place. President Xi apparently thought it inappropriate to show weakness and negotiate in such a confrontational style. China is different now.
The doubling of tariffs was accompanied by bellicose statements from U.S. leaders that seemed designed to intimidate opponents. US Secretary of Defense Pete Hegseth declared that the United States was ready to go to war with China. However, Beijing’s current policy is fundamentally different from that of Trump’s first term; every move now provokes an immediate reaction.
Now, as a first step, China has imposed additional tariffs of 10–15% on U.S. agricultural products such as chicken, wheat, corn and cotton. Additional 10% tariffs will be imposed on soybeans, pork, beef, seafood, fruits, vegetables and dairy products. In addition, China has added 15 U.S. companies to its export control list «to safeguard the country’s security and interests».
At the same time, Chinese Foreign Ministry spokesman Lin Jian told a briefing: «I would like to reiterate that the Chinese people have never been intimidated by threats or blackmail. They have never used methods of intimidation, pressure, coercion or threats — this is not the right way to conduct relations with China. Exerting heavy pressure on China means choosing the wrong target and making miscalculations. If the American side really wants to solve the fentanyl problem, it should consult with the Chinese side to solve its problems on the basis of equality, respect and mutual benefit. If the American side has hidden motives and insists on a tariff, trade or any other form of war, China will fight to the end. We urge the United States to stop bullying and return to the right path of dialogue and cooperation as soon as possible». For those Americans who do not follow the State Department briefings, the same points were reiterated by the Chinese Embassy in the US on Platform X.
Two days later, Lin Jian also responded to Pete Hegseth’s remarks, stating that the US Secretary of Defense’s declaration of readiness for war with China leads to confrontation. The diplomat stressed that official American claims that the United States is not seeking military action against China, but merely preparing for it, «deliberately provoke an ideological confrontation» and «create a stir over the so-called Chinese threat».
Without questioning the effectiveness of the Chinese authorities’ measures to counter the supply of fentanyl to the U.S., it is worth noting that history seems to be repeating itself — but in reverse. In the 19th century, Western countries (including the US) broke the resistance of the Chinese authorities through two Opium Wars and imported opium into China — addicting much of the population and effectively occupying the country. Now China, willingly or not, is paying the same price. Incidentally, some members of American high society are descendants of the drug lords who made their fortunes shipping opium to China.
It is not entirely clear whether Trump’s actions are intended solely to block fentanyl. This display of confrontational posturing may simply be preparation for a grand bargain — including the division of spheres of influence and the establishment of new rules of engagement between the two countries.
This interpretation is indirectly supported by some of Trump’s other statements. For example, he stated: «America is interested in investment from China and vice versa, but it will not allow Beijing to gain unilateral advantages». It is hard to imagine that Trump does not understand that if he takes his war with Beijing too far, major American companies — which are unlikely to survive without access to the Chinese market — will not be happy. Take Apple, for example, or even Elon Musk, who has deep ties to China with his Tesla factories.
Not long ago, the U.S. Chamber of Commerce released a report stating that China remains one of the most attractive destinations for investment, including significant capital flows from other countries. The report also noted that more than 70 percent of American companies operating in China produce goods for the Chinese market and do not exacerbate the U.S.-China trade imbalance. According to the Chamber, American companies in China plan to reinvest $14 billion in the country this year. However, this is a relatively small amount compared to the total foreign investment in China last year — about $200 billion — and the accumulated foreign investment in China, which totals $1.2 trillion. It turns out that the policies of the U.S. administrations are contrary to the interests of American business, which is losing profits and ceding ground to its closest allies. According to China’s Ministry of Commerce, investment growth last year was over 64 percent from South Korea, 52 percent from Germany and 40 percent from the United Kingdom.
The U.S. government’s desire to shift almost all production to the domestic market is unlikely to be fully realized. American companies may simply collapse. And that is just one problem that will have to be discussed and negotiated sooner or later. Perhaps these developments are precisely about preparing negotiating positions for the long-announced, but not yet held, talks between President Trump and Chairman Xi Jinping.
Moreover, the bellicose statements on both sides do not necessarily imply an immediate outbreak of some form of war. Although the fundamental contradictions between the two superpowers will remain, some of their individual disputes may eventually be resolved. For example, the U.S., through measures including those championed by President Biden, has forced the largest microelectronics manufacturer, Taiwan’s TSMC, to build factories in the United States. There will be five such plants, at a total cost of $165 billion to the chip industry leader. According to Trump, TSMC’s investments and «a few other projects» will allow the United States to control up to 40 percent of global chip production. And while the Taiwanese claim that their U.S. subsidiaries produce only 7 percent of their output, U.S. interest in Taiwan could plummet if Trump’s goals are met. As a result, military and economic support could be reduced — with all the attendant consequences for resolving the Taiwan issue.
Another major sticking point in U.S.-China relations is Beijing’s control of the rare earth metals market. China is known to produce up to 70 percent of this raw material. If the U.S., through Ukraine or otherwise, can reduce its dependence on its Chinese partner and thereby enhance its own security, this could, to some extent, also weaken the U.S. policy of confrontation.
The question of who will share the benefits of Ukraine’s reconstruction — and how — remains very much on the agenda. Clearly, Xi and Trump will have much to discuss. The only question is whether they will be willing to engage in dialogue — and when.