Asraful Bin Shofi Rabbi
The term ‘Trade War’ was first coined in the late 19th century by English newspapers to depict tariff conflicts among European powers and the United States. It referred to economic confrontations applied through levies, tariffs, sanctions, or quotas instead of coercion. In the modern era, President Donald Trump popularised the term as part of his ‘America First’ policy aimed at intercepting China’s economic ascent. After resuming office for the second time, Trump’s actions have once again drawn global attention to the trade war narrative. It is a contest in which China now appears to be gaining the upper hand.
The debate revived after President Trump and Chinese President Xi Jinping met on October 30 in Busan, South Korea. At the meeting, the US agreed to cut tariffs on Chinese imports by 10 percent, lowering the overall rate on Chinese goods to roughly 47 percent. The two sides came to an understanding with China purchasing more soybeans from the US, cooperation on rare earth elements, and restraining illegal fentanyl trade by Beijing.
Critics argue that the Busan talks reflected Washington’s eagerness to ease tensions, as the US economy has suffered more from the prolonged trade war. At the same time, China has managed to sustain steady growth despite persistent trade barriers. In September 2024, China’s exports to the United States stood at $47 billion. Exactly a year later, they dropped by 27 percent, falling sharply to $34.3 billion. Yet overall, China’s global exports rose 6.1 percent in the first two quarters of this year, with a notable 8.3 percent increase in September alone. This indicates that while trade with the US has declined, China is successfully diversifying its export markets and importing more from alternative partners and region.
Soybeans and beef are two commodities among America’s major exports to China and have become a central part of the latest trade discussions between the two capitals. According to U.S. Treasury Secretary Scott Bessent, during the Busan meeting, China agreed to buy 12 million metric tons (MT) of U.S. soybeans this season and committed to purchasing 25 million MT annually for the next three years. However, 25 million MT per year remains significantly lower than the levels recorded before the trade war. In return, Washington has to withdraw or review President Trump’s tariff and levy measures imposed on China since February 1.
In September, China did not import any soybeans from the United States and turned to Brazil and Argentina seeking new suppliers. Recent data from US Department of Agriculture shows the same pattern in the beef exporting market. Between January and July 2025, China purchased American beef of $481 million which is a 47 percent decrease from last year. By September, the number dropped and came to just $11 million. Compared with $110 million in 2024, it is a staggering 90 percent fall. To meet domestic demand, China is now buying more beef from Australia and Argentina.
The trade war has a bigger dimension and it’s about who sets the rules of global trade. Currently, China seems to be taking the lead. Trump’s core goal of weakening China’s manufacturing dominance and reviving the US industry is slipping out of reach. His unpredictable tariff policies have shaken confidenceand pushed many small businesses back toward Chinese suppliers.
America’s long-time allies Great Britain, Australia, Canada, Switzerland, India, and Brazil are now facing the heat of Trump’s tariff policy. These friends face tariff rates nearly equal to China’s, yet unlike Beijing, they lack diversified markets to cushion the blow. Trump cut fentanyl-related tariffs on Chinese firms, while raising tariffs on allies like Canada. As a result, China gained cheaper access to US markets. Thus Trump’s ‘great deal’ ended up favouring Beijing over Washington.
China’s real strength lies in its control of 85 percent of the world’s refined rare earths which are essential for smartphones, computers, electric vehicles, and fighter jets. When Trump threatened a 100% tariff, Beijing merely hinted at cutting supply.
Despite these turbulent conditions, China still exports $1 billion worth of goods to the US every day, while its stock market has risen by 34 percent in 2025. Interestingly, the US economy remains three times more dependent on China than vice versa.
The current tariff ceasefire is temporary, and Beijing appears to be playing the game longer to win. Trump has warned that he may re-impose tariffs or restrict Chinese exports if Beijing fails to keep its promises. He is also expected to meet Xi again in China early next year. Analysts warn that without a durable framework, the trade standoff could escalate once again. Officials from both countries are working to establish a sustainable framework for future trade agreements.
Trump’s trade war aimed to ‘decouple’ from China but achieved the opposite. Further, it tightened US supply chains to Beijing. China, meanwhile, has used the moment to gain leverage, reducing its dependence on American goods, expanding trade with alternative partners, weaponing rare earths, reshaping global trade norms, and strengthening its global footprint. On the contrary, American workers and farmers continue to bear the extra cost. Even China came into Busan Talks holding a strong position. The self-proclaimed ‘Great Deal Maker’ may have won headlines, but Xi won the advantage.
The writer is a Postgraduate, International Relations, University of Dhaka
