In Trump’s China visit, why breakthrough trade deals are unlikely

But apart from high-profile photo-ops and meetings, little is expected in terms of a breakthrough on trade or other concerns that have long plagued the ties. Here is why, and what happened the last time Trump visited China.

Issues at hand: Trade, global tensions, Taiwan

Beginning with Trump’s reciprocal “Liberation Day” tariffs on nearly all US trade partners in April 2025, average tariffs on China went from 34% to a high of 145% within a few days. China countered with 125% tariffs, and by May, both sides opened negotiations with top leaders meeting in Geneva.

China heavily leveraged its dominant position in processing rare earths, which are essential for manufacturing technological goods, to demand concessions. In fact, US Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng will meet in Seoul before Trump’s visit.

The basis of Trump’s tariffs was the belief that countries imposed trade restrictions on US-made goods while the US did not, resulting in a rising trade imbalance. This was contested by both economists and US trade partners, who pointed out that the US also purchased goods for lower prices thanks to the manufacturing scale of countries like China and Vietnam, and that tariffs could hurt domestic consumers.

Still, tariffs affected the US-China trade deficit (the difference in imports and exports), which stood at $346 billion in 2016 and dropped significantly to $202 billion by 2025.

However, rather than slowing down China’s manufacturing juggernaut, it made the country turn to the rest of the world. In 2025, China hit a $1 trillion trade surplus — a figure no country has ever registered — on account of trade with the Global South and other markets.

Trump in China in 2017. (Wikimedia Commons)

Trade imbalance was just one of the US’s long-held criticisms of China’s policies, apart from its trade subsidies for domestic firms, blue-collar job losses in the US due to Chinese manufacturing, and so on. The sheer range of complex issues makes the possibility of a grand deal remote.

On the other hand, lower-level deals or commitments could transpire. Much has been said about China already committing to buying soybeans, used as livestock feed on a large scale, from the US. This also matters for Trump ahead of the mid-term election in November, with rural Americans being a key demographic. Boeing is also looking for a massive order of aircraft from China.

But deeper concessions from China may not be easily won, because the tariffs episode showed its ability to weather unpredictable US policy. Despite a slightly downward GDP growth target this year, and a realisation that overcapacity in certain sectors may be even hurting its own producers, there is little to show that China is taking big steps towards fundamentally changing its trade policies.

Then there is the conflict in West Asia. China, like other countries, had obvious dependencies on the region for oil and the movement of goods, but this was another scenario where China emerged better-than-expected, thanks to years of investments in non-renewables and diversified crude supplies (like from Russia).

Beyond energy needs, China has stakes in regional peace and stability, owing to its ties with Gulf nations. After weeks of mostly issuing condemnations, China unveiled a five-point peace plan along with Pakistan. While it did not ultimately take, China was also reportedly behind nudging Iran to accept the ceasefire eventually negotiated with the US. Whether it can negotiate with the US for a peace plan for the region is again up in the air, dependent on what Trump seeks from the conflict.

The final concern is Taiwan. The United States has, for decades, maintained informal ties with Taiwan and sold military hardware to it. China has increasingly objected to such moves and asserted its territorial claims with flybys and sending ships to the Taiwan Strait.

Under Trump, however, the US has shifted from past precedents on many issues, seen as unrelated to immediate domestic concerns or of little value by Trump himself. China might want to use this period to have the US use more unequivocal language on accepting its Taiwan claims.

As the Communist Party mouthpiece Global Times said in an editorial, “The Taiwan question concerns China’s core interests and constitutes the first red line that must not be crossed in China-US relations… what the US especially needs to recognize is that maintaining peace and stability in the Taiwan Straits requires a clear and unequivocal opposition to ‘Taiwan independence’”.

Limited results from the 2017 visit

The GT editorial said that “Heads-of-state diplomacy plays an irreplaceable role in providing strategic guidance for China-US relations.” But too often, such summits have delivered more short-term relief.

Take Trump’s last visit in 2017. He said at the time to Xi, “My feeling toward you is an incredibly warm one. As we said, there’s great chemistry. And I think we’re going to do tremendous things for both China and for the United States.” But the visits to the Forbidden City and a reception at the Great Hall of the People, or even deals worth $250 million, did not stop Trump from imposing tariffs on Chinese goods the next year.

A 2020 “Phase One” deal saw China commit to increasing its purchases of certain US goods and services in 2020 and 2021 by at least $200 billion over 2017 levels. The US-based Pieterson Institute for International Economics found in 2022 that “China bought only 58 percent of the US exports it committed to purchase over 2020–21.” Last year, the US government initiated an investigation into the deal’s implementation at China’s end.