Trade War Monitor, Jun. 16: China, U.S. ‘Fighting While Talking’ During Tariff Truce
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After China and the United States reached a framework agreement to implement the Geneva trade consensus last week, tensions between the two capitals began to ease —for now at least. However, Washington’s new tariffs on Chinese consumer appliances have complicated the situation, highlighting a dynamic of “fighting while talking”.
At the same time, despite the temporary tariff truce, uncertainty over what will follow the 90-day reprieve has left many Chinese export companies in a holding pattern. As a result, economic performance across the China was mixed in May.
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- The U.S. and China reached a framework deal in June 2024 to implement the Geneva trade agreement, easing tensions, though new U.S. tariffs and export controls created persistent uncertainty.
- Chinese exports slowed in May, with growth down to 4.8% year-on-year, while unpredictable U.S. trade policy and tariffs up to 145% forced companies to shift strategies and hedge risks.
- Rising U.S.-China friction, tougher visa rules, and education policy swings have led many Chinese students and families to reconsider Western, especially U.S., higher education.
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Who’s Who
- JL MAG Rare-Earth Co. Ltd.
- JL MAG Rare-Earth Co. Ltd. is a Chinese maker of rare-earth magnets. It has been granted licenses to export rare-earth products to the U.S., Europe, and Southeast Asia. This development signals a softening of China's stance on rare-earth exports after trade talks with the U.S.
- CK Hutchison Holdings Ltd.
- CK Hutchison Holdings Ltd. is owned by Hong Kong billionaire Li Ka-shing. The company is currently under global review for seeking to sell 43 international port assets. China supports Panama's sovereignty and the neutrality of the Panama Canal amidst scrutiny over this deal, stating it opposes economic bullying and monopolistic behavior.
- Huawei Technologies Co. Ltd.
- Huawei Technologies Co. Ltd. is a Chinese telecommunications equipment giant. Its founder, Ren Zhengfei, believes China has many advantages in the AI race despite U.S. export restrictions.
- AcadeMe
- AcadeMe is a Beijing-based admissions firm founded by Yang Gang. The firm helps Chinese families explore higher education options. With rising geopolitical friction and stricter visa scrutiny from Western countries, AcadeMe notes that more Chinese families are reconsidering the value of Western higher education and looking towards more affordable destinations in Asia.
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What Happened When
- April 9, 2025：
- Trump administration tariffs on Chinese goods reach 145%; China retaliates with tariffs of up to 125%.
- May 2025：
- Geneva trade talks between China and the U.S. lead to a consensus and a temporary 90-day tariff truce.
- May 2025：
- U.S. revokes certain Chinese student visas and bans the sale of critical chip design software.
- After May 2025：
- The U.S. issues new export control guidelines on artificial intelligence chips one day after signing the Geneva statement.
- May 12, 2025：
- Temporary truce dials back most recent tariffs between the U.S. and China.
- June 3, 2025：
- Meng Qiyuan receives F-1 student visa approval at the U.S. Embassy in Beijing.
- June 5, 2025：
- Phone conversation between President Xi Jinping and U.S. President Donald Trump aids in resuming trade negotiations.
- June 9, 2025：
- China and U.S. reach an agreement to begin implementing the Geneva trade accord after two days of talks in London.
- June 9, 2025：
- China's National Bureau of Statistics releases economic indicators: retail sales grew 6.4% year-on-year in May 2025.
- June 10, 2025：
- China's foreign ministry states support for Panama’s sovereignty and canal neutrality regarding Li Ka-shing’s port asset sale.
- June 10, 2025：
- Huawei founder Ren Zhengfei interview downplays U.S. export restriction impacts on AI ambitions (published in People’s Daily).
- June 11, 2025：
- Li Chenggang announces a framework agreement for implementing the Geneva consensus in London; JL MAG Rare-Earth Co. Ltd. obtains export licenses (including to the U.S.).
- June 12, 2025：
- U.S. Department of Commerce issues notice on new 50% tariff for steel derivative products, affecting Chinese appliances.
- June 13, 2025：
- Chinese appliance manufacturers respond to the U.S. tariff announcement and begin evaluating its impact.
- As of June 2025：
- Global review ongoing for Li Ka-shing’s CK Hutchison Holdings sale of international port assets.
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