US and China open Beijing summit to repair damage from tariff war

Presidents Donald Trump and Xi Jinping convened in Beijing this week seeking to stabilize a trade relationship fractured by years of escalating tariffs that cut bilateral commerce nearly in half, The Korea Times reported.

The summit follows a years-long tariff escalation that pushed average U.S. duties on Chinese goods from 3.1 percent to 48 percent, reshaping global supply chains and forcing American companies to build costly alternatives — a structural shift economists warn will not easily unwind.

The Beijing talks are focused on extending a trade truce, with China potentially committing to buy American soybeans, beef and Boeing aircraft, The Korea Times reported. Both governments are also discussing the creation of a joint Board of Trade to govern future commercial disputes. Average U.S. tariffs on Chinese goods surged from 3.1 percent in 2017 to 48 percent in 2026, briefly peaking at 145 percent in 2025.

The tariff escalation dramatically reshaped bilateral commerce. China's share of U.S. total trade fell from 13 percent in 2016 to 6.4 percent in 2025, according to The Korea Times, while the U.S.-China trade deficit narrowed from $377 billion in 2018 to $168 billion last year. Mexico and Canada have since displaced China as America's top trading partners.

Yet executives warn a clean break between the two economies is impossible. "Most serious manufacturers did not simply 'leave China,'" said Jacob Rothman, CEO and founder of Velong Enterprises. "Instead, they built multi-country supply chains around China." The Korea Times reported that Chinese companies also adapted by creating transshipment networks through Vietnam, India and Southeast Asia to route goods around tariff barriers.

Council on Foreign Relations Senior Fellow for China Studies Zongyuan Zoe Liu cautioned against reading trade data as true decoupling. "It would be wrong to think that China is no longer relevant for the U.S. market," Liu said. "Chinese goods are still coming into the U.S."

The conflict has hit American exporters hard, The Korea Times reported. U.S. soybean sales to China dropped 75 percent in 2025 even after an October truce. China's global trade surplus reached a record $1.2 trillion last year, demonstrating that Beijing redirected commerce rather than absorbed the losses. Beijing retains additional leverage through critical minerals, controlling roughly 80 percent of the world's tungsten supply.

Persistent uncertainty is itself a drag on business, economists say. "Trade tensions can flare up quite quickly, and that makes the U.S. firms hesitant to rely too heavily on Chinese supply," said Sarah Tan, an economist at Moody's Analytics. Former U.S. Commerce Secretary Wilbur Ross framed the summit's stakes plainly: "We are the No. 1 trading player. They are next in line. We have to coexist in some way. The question is, what will be the rules of the road, and who will benefit the most from those rules."

A proposed Board of Trade, if established, would mark the first formal bilateral trade governance body between the two powers — a signal that Washington and Beijing may prefer structured competition over continued economic conflict.