The trade war between China and the United States has shown signs of de-escalation as both Washington and Beijing are now more willing to communicate.
Xie Feng, Chinese Ambassador to the US, on May 4 urged the US to “act in the spirit of equality, respect and reciprocity” if it wants to hold trade talks with China.
“The US has long benefited from global trade, enjoying affordable goods from around the world while leading in finance, technology, and services,” Xie said in a speech at a Chinese Embassy event in Washington on May 4. “In 2022 alone, the sales revenue of the US-owned enterprises in China significantly exceeded those of Chinese-owned enterprises in the US by over $400 billion.
“The China-US economic relationship is, over all, balanced and mutually beneficial. Tariff hikes benefit no one. They disrupt business, raise costs, rattle financial markets, and slow global growth.”
He stressed that China does not want a trade war, but is not intimidated by it.
The Chinese Ministry of Commerce (MoC) said on May 2 that “China has noticed the US side constantly talking about adjustments to its tariff measures.” It said the US would demonstrate a complete lack of sincerity and further undermine mutual trust if it does not rectify its erroneous unilateral tariff measures.
Some Chinese media said the MoC’s statement was a nice gesture to Washington, which had suffered seriously from the trade war and wanted trade talks.
Beijing’s expectation for a significant tariff cut had grown after the Wall Street Journal reported on April 23 that the White House would consider lowering tariffs on imported Chinese goods pending talks with Beijing.
The WSJ, citing a senior White House official, said China’s tariffs could be reduced from their current level of 145% to between 50% and 65%.
Since the US imposed a 145% tariff on all Chinese imports on April 9, many factories in China’s Dongguan and Yiwu have reportedly lost all American orders and stopped production. Retail shops in key cities are closing due to declining customer numbers.
“The Chinese are getting killed right now,” US President Donald Trump told NBC journalist Kristen Welker in an exclusive interview on May 4. “They’re getting absolutely destroyed. Their factories are closing. Their unemployment is going through the roof.”
“I’m not looking to do that to China. At the same time, I’m not looking to have China make hundreds of billions of dollars and build more ships, more army tanks and more airplanes,” he added.
Welker asked Trump whether he would “drop the tariffs against China to get them to the negotiating table.”
“No, why would I do that?” Trump said.
“Would you lower them?” Welker fine-tuned her question.
“At some point, I’m going to lower them, because otherwise you could never do business with them, and they want to do business very much. Look, their economy is really doing badly. Their economy is collapsing,” Trump said.
He then said the US tariffs had resulted in substantial investment inflow for the US. He said he would not permanently let the tariffs come off the table, as such a move would discourage companies from building factories in the US.
In an interview published by Time magazine on April 25, Trump said Chinese President Xi Jinping had called him by phone. However, Beijing said Xi had not made the phone call.
While the verbal fight between Washington and Beijing has by no means ended, Bloomberg reported on May 2 that China has already exempted its reciprocal tariffs of 125% for around $40 billion of American goods, equivalent to a quarter of total imports from the US.
The exempted products include 131 products, including pharmaceuticals and industrial chemicals.
‘Backstabbed’ by the EU
Last month, Trump imposed reciprocal 10-50% tariffs on almost all trading partners, but he allowed 90 countries, except China, to pay only a 10% tariff in the next 90 days.
On April 18, Rachel Reeves, chancellor of the exchequer in the United Kingdom, told The Telegraph in an interview that it would be “very foolish” for Britain to disengage from China, the world’s second-largest economy.
On April 22, the European Commission (EC) said it will only “derisk” rather than “decouple” from the Chinese economy as a condition for reaching a trade deal with the Trump administration.
The Chinese Foreign Ministry released a video titled “Never Kneel Down!” on April 29.
“Bowing to a bully is like drinking poison to quench thirst. It only deepens the crisis,” the footage said. “History has proven that compromise won’t earn you mercy. Kneeling only invites more bullying.”
However, on the same day, the EC imposed definitive countervailing duties on imports of China’s mobile access equipment (MAE), which is used to lift workers to carry out construction work at height. The EC said the measures aim to shield the European Union’s MAE industry from unfair trading practices.
The EU’s anti-subsidy duties range between 7.3% and 14.2%. In addition to the anti-dumping duties imposed in January 2025, the combined duties range between 20.6% and 66.7%.
A Hebei-based columnist using the pseudonym “Yunshuihan” criticizes the European Union for backstabbing China with new tariffs.
“This is typical ‘schizophrenia.’ The EU wants to enjoy the Chinese market, but is afraid of offending the US,” the writer says.
He says the EU wants to please the US by hurting China; if necessary, China could ban exports of rare earths and auto parts to Europe.
Another Chinese writer says he would not worry about the EU tariffs as Chinese manufacturers can find ways to minimize the impact.
For example, he says that Sinoboom, a Chinese aerial work equipment maker, recently sold 500 scissor lifts to a customer in Turkey, who then changed the product label and resold them to the EU.
Turkey is not an EU member, but it formed a customs union with the EU in 1995. As such, it can export industrial and processed agricultural goods to the EU tariff-free.
Turkey has to impose EU tariffs on imports from non-EU countries, but it can waive some for those who invest in its territory. In March 2023, it imposed an additional 40% tariff on Chinese autos, on top of a 10% EU tariff for imported cars. Since last July, Turkey has waived the extra tariff for Chinese automakers with factories there.
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