Reset or Rematch?

That there is widespread pessimism among Chinese experts over the future of the bilateral relationship is of no surprise. In his first term, Trump launched a trade war against China and imposed controls on China’s access to US technology and capital. It marked the sharpest downturn since former president Richard Nixon’s historic visit to China in 1972 and kicked off a new era of worsening China-US ties. ChinaUS relations spiraled down ever since, as president Joe Biden inherited and escalated Trump’s China policies.　

Yet, some remained cautiously optimistic that Trump would adopt a more pragmatic approach toward China, pointing to Trump’s transactionalist style of leadership and his isolationist tendency. As Trump is seen to be more interested in making deals than ideological preaching, it is argued that Trump could reduce the strategic pressure on China to reach some kind of détente.　

Now, over one month into Trump’s second term, it appears any remaining optimism is evaporating. But the consensus among many Chinese experts is that China is in a more powerful position to respond to Trump 2.0.

While Trump himself appears to have refrained from badmouthing China since assuming the presidency, his administration wasted no time in pushing forward its anti-China agenda. On his first day as secretary of state, Rubio met with counterparts from Australia, India and Japan in Washington, DC, the first meeting of the China-focused “Quad” in Trump’s second term.

　

Two days later, Rubio called his Philippines counterpart, Secretary of Foreign Affairs Enrique Manalo, criticizing China’s “dangerous and destabilizing actions in the South China Sea” and reaffirming an “ironclad” US defense commitment to the Philippines. China has long accused the US of encouraging and emboldening Manila to take frequent “provocative actions” over disputed features in the South China Sea.　

Trump also ramped up pressures on Panama – threatening to “take back” the Panama Canal by force if necessary and accusing the country of ceding control of the vital waterway to China, an accusation rejected by both Panama and China.　

For his first overseas trip, Rubio visited Panama on February 1 to deliver Trump’s warning to Panamanian President Jose Raul Mulino in person. Mulino subsequently announced the country is pulling out of the China-led Belt and Road Initiative.　

On February 8, Trump met with Japanese Prime Minister Shigeru Ishiba at the White House. In a joint statement released after the meeting, the two leaders voiced opposition to China’s military actions in the South and East China seas, and addressed Taiwan, pledging support for “Taiwan’s meaningful participation in international organizations.”　

A week later on February 15, Rubio met with Japanese Foreign Minister Takeshi Iwaya and South Korean Foreign Minister Cho Tae-yul on the sidelines of the Munich Security Conference (MSC). Pledging to “take decisive actions to counter threats, enhance economic resilience and advance shared interests,” their trilateral joint statement again directly mentioned Taiwan, claiming to “encourage the peaceful resolution of cross-strait issues.”　

The moves are in direct defiance to the message delivered by China’s Foreign Minister Wang Yi during a phone call with Rubio on January 24. Stressing that the Taiwan question is China’s “red line” and that China will never allow Taiwan to be split from China, Wang urged the US to “handle the issue prudently.”

China responded within moments with retaliatory measures, including a 15 percent tariff on imports of US coal and liquefied natural gas products, and a 10 percent tariff on crude oil, agricultural machinery and large engine cars starting from February 10, the same day the US tariffs took effect.　

China also announced new export controls on five metals, including tungsten, tellurium, bismuth, molybdenum and indium, by requiring licensees to export products related to the minerals. These metals are widely used in defense, clean energy and other industries, and it is estimated that China produces 80 percent of the world’s tungsten.　

Moreover, China launched an anti-monopoly probe into technology giant Google, adding PVH, the US owner of designer brands Calvin Klein and Tommy Hilfiger, to its “unreliable entity” list.　

According to Ding Ru, an associate professor at the China University of Political Science and Law, China’s response is both precise and restrained. “By targeting specific products and imposing different tariffs, China ensures a precise impact while avoiding excessive reactions that could hurt the interests of Chinese companies of relevant industries,” Ding told NewsChina, “In the meantime, it leaves room for future dialogue and negotiation.”　

In the meantime, China filed a lawsuit with the World Trade Organization (WTO) against the US, although it is unlikely that the WTO can take any meaningful action as the US has blocked the appointment of new judges to the WTO’s seven-member appellate court since 2017, which has paralyzed its dispute settlement mechanism.　

Although it is largely symbolic, bringing the case to the WTO can highlight China’s image as the defender of multilateralism and a responsible major power, Ding said.　

While the additional tariffs fall far short of Trump’s previous threats of 60-200 percent, China’s swift reaction indicates that the Chinese government is getting ready for the Trump 2.0 era.　

In a commentary published by Singapore-based Lianhe Zaobao on November 12, Zhu Feng, professor and dean of the School of International Studies, Nanjing University, said it has become utterly clear that the US will continue its aggressive approach to contain China in the Trump 2.0 era. “As the US has firmly targeted China as its biggest rival, it is nearly impossible to make any substantive easing of bilateral tensions in the short and midterm,” Zhu said.　

However some are still hopeful that it is not too late for the two countries to reach a deal. In a commentary published by the Chinese version of chinausfocus. com on February 14, Zhang Monan, deputy director of the Institute of American and European Studies, China Center for International Economic Exchanges (CCIEE), said the two countries still have the potential to reach a “comprehensive framework agreement.”　

Zhang argued that although Trump’s cabinet is stacked with China hawks, Trump remains the final decision-maker. As someone who enjoys exercising power and considers himself a “deal-making president,” “Trump may still be flexible regarding his China policies,” Zhang said.

On February 10, Trump said in an interview with Fox News he had spoken to Xi since taking office on January 20, without offering details. But China’s foreign ministry only acknowledged the call on January 17, and did not respond to his remarks. On January 19, Trump said he expected President Xi to visit the US without giving a timeline, adding that “it’s possible” for the US and China to reach a new trade deal.　

According to Jin Canrong, a professor at the Renmin University of China in Beijing, Trump’s apparent positive rhetoric about China and Xi is a type of “hypocritical flattery.” “Such flattery is commonly used by businessmen who seek to gain benefits through compliments and the Chinese government has remained clear-headed, and is not to be deceived,” Jin said in an interview with domestic media outlet guancha.cn on February 12.　

Trump visited China in November 2017 in his first term, and was welcomed with lavish hospitality, only to launch his trade war against China two months later. This time, Trump said on January 22 that he has “always had a great relationship” with President Xi and that he looks forward to “getting along with China.” Within two weeks, he imposed the additional 10 percent tariff on Chinese imports.　

Given Trump’s unpredictable style, Xi may not be in a hurry to meet Trump. According to Jin, Trump has a genuine incentive to visit China as he is well aware that China has always placed great importance on US-China relations, and a visit to China would secure him prestige and political gains. But from China’s perspective, a leaders’ summit still requires further negotiations, and the US needs to respond to China’s concerns on its red lines and core issues such as the Taiwan question.

“Eight years ago, trade with the US accounted for 17 percent of China’s total trade, but now the ratio has dropped to 11 percent,” said Wang Wen, dean of the Chongyang Institute for Financial Studies at Renmin University, in a commentary published by guancha.cn on November 25, 2024. Wang wrote that the rise of the Global South in the past eight years has significantly strengthened China’s position in the global strategic landscape.　

“Trump 1.0 taught China how to transform external pressure into a driving force for deepening reforms and promoting development,” Wang said. He argued that in the Trump 2.0 era, the strategic rivalry between China and the US will become more internalized. “It will no longer be a contest of who can overpower the other, but rather a competition in strengthening internal capabilities and advancing self-development,” Wang said.　

This appears to be the mindset adopted by Chinese leaders. In an on-stage conversation with veteran German diplomat and outgoing MSC chairman Christoph Heusgen during the conference on February 14, Foreign Minister Wang Yi cited a quote from a popular martial arts novel to illustrate China’s position in handling its ties with the US.　

Acknowledging the subtlety and difficulty of translating the quote, Wang jokingly recommended journalists to seek assistance from DeepSeek, a Chinese AI model launched in January that broke the monopoly of American companies on large language models and sent shockwaves through the global market.　

According to DeekSeek R1, the quote translates as “Let him be strong as he may, the gentle breeze still sweeps the hills; Let him rage as he will, the bright moon still lights the great river.” While it is more accurate to replace the word “strong” with “tough,” the translation largely conveys the core meaning of the quote, which suggests that no matter how arrogant or aggressive one’s opponent may be, one should remain calm and unwavering.　

Wang elaborated that China is ready to build a stable, healthy and sustainable relationship with the US based on the three principles of mutual respect, peaceful coexistence, and win-win cooperation, and he hopes that the US will move in the same direction.　

On February 21, Chinese Vice Premier He Lifeng held a video call with US Treasury Secretary Scott Bessent on important bilateral economic issues. However, hours later, the White House announced new restrictions on bilateral investment in “strategic” and “sensitive” sectors and technologies. China’s Ministry of Commerce responded that China would take “necessary measures” to safeguard its legitimate rights and interests.