Trump-Xi trade truce highlights China’s growing leverage over the US

The trade truce struck between US President Donald Trump and Chinese President Xi Jinping in South Korea has sparked debate over which side won. but few dispute that Beijing entered the talks in a far stronger position than before.

At their meeting on the sidelines of the APEC summit, Xi emerged with notable concessions from Washington, including a partial rollback of US export controls on Chinese technology firms. For Beijing, the outcome underscored its growing clout after years of Trump’s tariff wars.

“In the face of winds, waves and challenges, we should stay the right course, navigate through the complex landscape, and ensure the steady sailing forward of the giant ship of China-US relations,” Xi said, framing the two leaders as equals “at the helm” of a global partnership.

Since Trump launched his first trade war in 2018, China has fortified its economy to withstand pressure while gaining new leverage. Beijing’s decision last month to require global firms to seek approval before exporting goods containing its rare earth minerals signalled its willingness to weaponise its dominance in critical materials.

With China controlling roughly 70 percent of rare earth mining and 90 percent of global refining capacity, the move rattled markets and underscored the risks of Washington’s dependency.

China also hardened its economic defences by cutting dependence on US agricultural imports. Its effective ban on American soya beans earlier this year redirected trade to Brazil and Argentina, halving the US share of China’s imports and dealing a blow to farmers in key Republican states such as Iowa and Indiana.

That pressure, analysts say, gave Beijing bargaining room.

Under the agreement, China will resume some US soy purchases and delay planned export controls on five of its 12 rare earth elements, though restrictions on the remaining seven remain in place.

In return, Trump has agreed to lower a tariff linked to fentanyl-related imports from 20 percent to 10 percent, a move seen as a rare Chinese win in an otherwise tense trade landscape.