China emerges as US ‘peer rival’ at Xi-Trump summit
China’s President Xi Jinping met Donald Trump in South Korea this week to halt an escalating trade war. The meeting marked their first face-to-face discussion in six years and showed how much global power dynamics have changed since their last encounter.
Xi echoed Trump’s “Make America Great Again” message by linking it to China’s own “great rejuvenation” plan. He told Trump, “China’s progress should align with your vision to make America great again.”
Behind the friendly words, the power equation looked different. In 2016, Trump’s early tariffs had surprised Beijing. Now, a more prepared and wealthier China has met U.S. pressure with equal force.
Since Trump imposed new “liberation day” tariffs in April, China has blocked several U.S. actions and forced Washington to renegotiate. When Trump raised reciprocal tariffs to 145 percent, Beijing matched them and made the U.S. suspend its levies.
The next dispute centered on China’s control of rare earth exports—materials essential for U.S. manufacturing. Beijing’s restrictions pushed Washington back to the table. A similar scenario followed when the U.S. extended chip export controls to thousands of Chinese subsidiaries. China again responded with its own rare earth limits, prompting another truce effort.
Analysts at BNP Paribas said Washington now faces “a peer rival capable of imposing real economic harm,” confirming China’s new global status.
During Thursday’s talks, Xi called the U.S. and China “co-captains of a giant ship,” suggesting equality in steering their relationship. Both sides agreed to suspend new export controls and reduce tariffs for one year. The U.S. cut average tariffs on Chinese fentanyl-related goods to 45 percent, while Beijing resumed soybean purchases.
Zhao Minghao of Fudan University said Xi’s message aimed at merging two national agendas — “Make China Great Again” and “Make America Great Again.” He added that China’s next five-year plan for 2026–2030 prioritizes domestic demand, creating openings for more U.S. exports such as agricultural products, energy, and aircraft.
At the same time, China’s plan strengthens its push for self-reliance in advanced technology, science, and manufacturing. Gabriel Wildau of Teneo noted that Beijing sees some industrial oversupply as an acceptable cost for greater independence and leverage in critical sectors like batteries and rare earths.
Analysts expect tensions to continue. Most summit agreements paused penalties rather than removing them. “Both sides are keeping leverage for future talks,” said Chaoping Zhu of JPMorgan Asset Management.
Disputes over Taiwan, the South China Sea, and China’s ties with Russia remain unresolved. As Zhao observed, the summit delivered “a tactical détente, not a strategic reset.” Economic teams from both nations will now try to convert the temporary peace into durable policy.
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