#12 China Scholar Insights: The China-U.S. Relations
While a complete resolution of differences may not be feasible in the near term, a framework for managing tensions and avoiding conflict is essential.
Welcome to the 12th edition of China Scholar Insights!
China Scholar Insights is a feature aiming to provide you with the latest analysis on issues that Chinese scholars and strategic communities are focusing on. We carefully select commentary and highlight key insights. Questions and feedback can be directed to sch0625@gmail.com
I’m SUN Chenghao, a fellow with the Center for International Security and Strategy (CISS) at Tsinghua University. ChinAffairsplus is a newsletter that shares Chinese academic articles focused on topics such as China’s foreign policy, China-U.S. relations, China-Europe relations, and more. This newsletter was co-founded by my research assistant, ZHANG Xueyu, and me.
China Scholar Insights on the China-U.S. Relations
Background
After Trump’s return to the White House, China-U.S. Relations have grown increasingly competitive, marked by disputes over trade, technology, security, and global influence. With the return of “America First” policies, the rivalry has intensified, with the U.S. adopting a tougher stance on China across economic and strategic domains. As tensions rise over issues such as the South China Sea and bilateral trade imbalances, both countries face pressure to manage confrontation while safeguarding their national interests and global standing.
Summary
Under Donald Trump’s second term, China-U.S. Relations have entered a phase of strategic competition across economic, political, and security domains. The “Trump 2.0” is expected to maintain a confrontational stance toward China, through military deterrence, economic sancations, and influencing regional actors, posing risks to Asia-Pacific stability, particularly in the South China Sea. In response, China must remain vigilant, safeguard its core interests, and promote initiatives. Meanwhile, Trump’s tariff war accelerated a global shift toward multilateralism and strategic autonomy. May 12, 2025, Joint Statement from the China-U.S. Geneva Talks marked a breakthrough, reflectiong trend toward “de-Americanization” in global economic governance.
Insights
SUN Chenghao: How to Stabilize China-U.S. Relations Under Geopolitical Tensions
After his return to the White House, Donald Trump doubled down on“America First” policies, intensifying China-U.S. hostilities. The two countries should consider actionable pathways for stabilizing the bilateral relationship.
China-U.S. relations face heightened competition across economic, political, and security dimensions under Trump’s second term
Economically, Trump’s imposition of so-called “reciprocal tariffs” and continued escalation in response to China’s countermeasures have imposed profound difficulties on the bilateral economic relationship. The U.S. Trade Representative (USTR) Jamieson Greer’s proposal to revoke China’s “permanent normal trade relations” (PNTR) status adds to these challenges,
Security tensions in Taiwan and the South China Sea are also poised to increase U.S. arms sales and official visits to Taiwan, and intensify the lack of trust and communication channels between the militaries on both sides of the strait. These factors may collectively heighten the risk of confrontation.
Moreover, Trump’s transactional approach to diplomacy and disdain for multilateralism may result in the neglect of formal dialogue mechanisms. He may also prioritize unilateral actions over coordinated efforts to address multilateral issues, leading to greater misunderstandings and miscalculations.
While challenges abound, there are several possible steps both sides can take to stabilize relations and prevent further deterioration
The first and most urgent step is to institutionalize communication mechanisms at multiple levels. Both sides should continue or re-establish regular high-level dialogues on trade, security and law enforcement.
A shared understanding of what constitutes acceptable competition is critical to avoiding conflict. Both sides could work toward a framework that clarifies sensitive areas and outlines protocols for managing disputes, providing a structure for managing them responsibly.
On economic issues, both sides should focus on practical measures. China could enhance transparency in its economic practices, and the U.S. could ease certain tariffs and provide clearer guidelines for Chinese investments in non-sensitive sectors. China and the U.S. should also remain open-minded about negotiating a new trade agreement or revising existing frameworks.
Taiwan will remain the most dangerous flashpoint in China-U.S. relations. To avoid escalation, both sides must exercise maximum restraint.
As for deepening people-to-people exchanges, both governments should prioritize facilitating visa processes for students and researchers, supporting joint scientific projects, and encouraging dialogue between think tanks.
Despite significant differences, China and the U.S.’ common interests in addressing global challenges provide opportunities for collaboration that could build goodwill and offset tensions in other areas.
While a complete resolution of differences may not be feasible in the near term, a framework for managing tensions and avoiding conflict is essential. Ultimately, the future of China-U.S. relations will depend on the willingness of both sides to prioritize stability and coexistence over competition and confrontation.
ZHU Feng: In the Era of "Trump 2.0," What Kind of Stunts might the U.S. Pull in the South China Sea?
Trump's policies will exacerbate instability in the South China Sea
Three months into Trump's second term, his administration's aggressive pursuit of "America First" policies marked by protectionism, nationalism and unilateralism has introduced new uncertainties into South China Sea affairs. Trump's 2.0 policies are expected to intensify efforts to suppress and contain China's sovereignty over islands and reefs, further accelerating the emergence of a "new Cold War" dynamic in the South China Sea.
South China Sea policy under Trump 2.0 warrants vigilance across diplomatic, military or political domains
In recent days, the U.S. Defense Secretary Pete Hegseth embarked on his first trip to Asia as part of his defense diplomacy efforts, with Japan and the Philippines as his two destinations. This makes clear the fact that the Trump administration is not scaling back its interference in the South China Sea.
First, the Trump administration is expected to further expand the U.S. military footprint in the Asia-Pacific. Echoing Cold War-era tactics, it is likely to intensify the deployment of intermediate-range missiles in the region and strengthen military deterrence against China.
Second, Washington will continue to portray China’s maritime strategy as an attempt to establish a power-based order, co-opting more countries into supporting the distorted narrative of China’s “bullying” and “coercive” behavior in the South China Sea, and providing a pretext for the U.S., Japan, India, and some NATO countries to intervene. Additionally, the U.S. will impose legal constraints and exert international pressure on China through international law and multilateral platforms. It is likely to keep supporting ASEAN claimants in their use of UNCLOS to challenge China’s territorial integrity.
Third, The Trump administration may also continue to weaponize economic sanctions to intervene in the South China Sea issue. Statistics show that since January 2018, when the Trump administration first escalated trade tensions with China, the frequency of US“Freedom of Navigation”operations has been closely linked to the intensity of trade disputes. Furthermore, the US has imposed sanctions on Chinese companies and officials involved in developing infrastructure on South China Sea islands.
China needs to step up its efforts in response to the Trump administration's scaling up of US interference in the South China Sea
First, China should continue to maintain its military deterrence while actively advancing economic, diplomatic and social engagement and simultaneously deepen its cooperation with ASEAN countries. China should also continue to promote the construction of a maritime community with a shared future, enhancing the regional economic win-win framework.
Second, China should strengthen cooperation with ASEAN countries in port development, digital infrastructure and cultural exchanges through the high-quality building of the Belt and Road.
Finally, China should bolster communication and dialogue between governments and militaries with the US, enhance the strategic trust-building mechanism, and promote military exchanges at the theater level. This will help effectively prevent any unforeseen incidents that could lead to military conflict, ensuring that China-US relations continue to evolve a stable, mature framework for both competition and cooperation, with better management of tensions.
ZHOU Xiaoming: Where is the Trade War Heading?
China can cope with the loss of demand better than the U.S. can cope with the shortage of supply
The trade war initiated by Trump has caused a deadlock in China-U.S. relations. Despite facing reduced orders and shrinking manufacturing sectors due to the trade war, China is more confident about withstanding the impact of the trade war and achieving its economic growth targets than during Trump’s first term in office. And because of the U.S.' dependence on many Chinese goods, tariff policies have also begun to put pressure on American consumers and businesses. Even important industries such as the US defense sector may not be able to complete their original manufacturing plans due to the export restrictions on rare minerals from China. Although Trump and his Council of Economic Advisers are confident that the U.S. can produce products or purchase them from other countries to replace Chinese supply, this will inevitably be difficult and costly in the short term. American consumers are likely to experience shortages of goods, and companies will be forced to stop operations.
The trade war will not only affect China and the U.S. but also lead the U.S. to confront other states
On the one hand, Trump's punitive tariff policy blatantly violates the World Trade Organisation’s most-favored-nation principle, disrupts the international economic order, and has caused dissatisfaction among global rivals and allies alike; on the other hand, China is not eager to negotiate a compromise, and its countermeasures have received support from other states, especially those that have difficulty coping with Trump's high tariffs. China's countermeasures are conducive to maintaining the multilateral trading system and international fairness and justice.
Reaching a trade agreement between China and the United States may take months or even years
Even if trade negotiations are finally launched, tensions may still persist. In China's view, Trump's cancellation of all unilateral tariffs against China is an issue of principle. Trump's rationale for provoking the tariff war is that China has not given enough support to the United States on the fentanyl issue. However, in China's view, the drug crisis is a problem of the United States' own, and Washington ought to be grateful for China's assistance. Trump insisted that China would need to make substantial concessions for him to cancel the tariffs. Before the negative impacts of the tariffs became apparent, it looks as if he isn’t going to change this hardline policy. The different views of the two sides make it difficult for China and the United States to reach an agreement in a short time-frame.
ZHANG Yun: China-U.S. Tariff Negotiations and Major Changes in International Relations
The progress of China-U.S. tariff negotiations reflects a broader shift in international relations
China and the United States reached an important consensus at the tariff negotiations in Geneva, with both sides agreeing to substantial reductions in tariff rates. This progress is a victory for China’s firm stance against unreasonable high tariffs and its consistent advocacy for resolving disputes through dialogue on an equal footing. However, this should not be simply defined as the winner and the loser. The outcome should instead be seen as reflecting a broader shift in international relations, signaling the rise of global rationality and conscience in trade governance.
Trump's tariff war has prompted increased awareness of ‘strategic autonomy’ in various regions, triggering a new wave of regional integration
Taking Latin America as an example, its economy has long been highly dependent on the United States, while its proportion of intra-regional trade is only 15%. The uncertainty brought about by Trump's tariff war has intensified the sense of economic crisis in Latin American countries, prompting countries in the region to pursue greater autonomy and cooperation. The growing economic relations between Latin America and Asia in recent years have opened up new development opportunities for Latin America. At the same time, China has become the second-largest trading partner in Latin America and the Caribbean, and the largest trading partner of Chile, Brazil, and Peru. Five countries in the region have signed free trade agreements with China. The trade volume of 12 South American countries with China is already 1.5 times the trade volume of these countries with the United States. In addition, Japan, South Korea, and Southeast Asian countries are also increasingly becoming important trading partners for this region.
The strategic autonomy of U.S. allies is also evolving. This year, the China-Japan-South Korea Economic and Trade Ministers' Talks resumed after many years, and they agreed to speed up discussions on the China-Japan-South Korea Free Trade Agreement. These countries are all members of the G20 and major economies. The trade volume among the three countries exceeds US$800 billion. Meanwhile, the conclusion of the upgraded China-ASEAN Free Trade Agreement signals the formation of a vast market covering 2 billion people. The United States has always tried to use strong pressure to make its allies compromise in economic and trade negotiations. Allies such as Japan are facing an unpredictable United States, yet the essence of an alliance lies in the acquisition of certainty. This means that the United States' allies will have to find new alternative sources of certainty in their own country, in the region and at the global level.
Trump's tariff war did not scare the world. On the contrary, it served as a catalyst and accelerator for countries around the world to maintain the multilateral free trade system and pursue strategic autonomy by finding alternatives. The substantial progress made in the China-US tariff negotiations is essentially in line with the general trend of the world economic governance system moving towards "de-Americanization".
WANG Yong: Mitigating China-US Trade Tensions and Anchoring Global Economic Certainty
Trade agreement reaches breakthrough in Geneva
In May 2025, China and the U.S. issued the Geneva Joint Statement on Economic and Trade Talks, marking a phased resolution to months of tariff disputes. Under the agreement, both sides agreed to reduce bilateral tariffs significantly. The deal aligns with mutual interests and injects stability into global trade by establishing a“rules-based”framework.
China’s negotiation strategy: rules and reciprocity
China adhered to three core principles—equality, pragmatism, and safeguarding national interests—during the talks. By employing a“dynamic balance”approach, tariff adjustments and countermeasures were synchronized. China’s retaliatory measures struck U.S. vulnerabilities, in particular an agricultural industry reliant on Chinese markets. Tariffs on soybeans and corn pressured Republican strongholds, prompting lobbying efforts that pushed the White House to reassess policies. Beyond tariffs, China utilized “asymmetric deterrence,” such as rare earth export controls, given its dominance in 90% of global refining capacity. These moves compelled concessions in tech negotiations, in which ongoing U.S. restrictions on advanced chip equipment exports are a major talking point.
The agreement boosts market confidence but remains a temporary "ceasefire" in nature
The agreement alleviated fears of a“tariff cliff,”spurring immediate market optimism. A structured dialogue mechanism—quarterly technical talks and biannual ministerial meetings—was established to address intellectual property and technology disputes, offering a roadmap for resolving structural tensions. However, despite progress, the agreement remains a temporary truce. Political risks, such as U.S. protectionist factions and geopolitical flashpoints, could hinder implementation.
The negotiations over the next 90 days will be the touchstone for the long-term implementation of the agreement
Future negotiations on tech standards, market access, and WTO reforms will test the pact’s durability. China and the United States should jointly promote WTO reforms, establish new standards in fields such as green energy and digital trade, and upgrade the "consultation mechanism" in the agreement to an "incubator" for global rules. At the same time, China should form a “multilateral counter-alliance”with the EU, ASEAN, and others to institutionalize constraints on U.S. unilateralism.
Conclusion
China-U.S. Relations are entering a period of heightened friction and structural rivalry, with rising tensions in the South China Sea and renewed trade disputes placing increasing strain on the bilateral relationship. However, these challenges also reveal the possibility of building mechanisms for communications, crisis management, and cooperation. Both China and the U.S. must recognize that strategic competition cannot come at the expense of global stability. In an increasingly multipolar world, a balanced, rules-based framework will be essential to avoid escalation.
Writers and Editors for Today’s Newsletter:
Editors： SUN Chenghao, GAO Liangyu, WANG Jiaying, BAI Xuhan, HU Lingzhi, HNIN Lei Lei Wai, ZHANG Xueyu, BAI Xuhan, ZHANG Xueyu and Hannah Shirley
