China: Managed trade truce prospects – Standard Chartered

Standard Chartered economists Carol Liao and Shuang Ding argue that both the US and China are incentivised to keep their bilateral relationship stable as President Trump’s 14–15 May visit approaches. They see a focus on preserving the existing tariff truce, modest trade concessions in non-sensitive sectors, and pragmatic, transactional arrangements rather than a comprehensive reset or grand bargain.

Pragmatic truce with limited concessions

"President Trump will most likely visit China from 14-15 May as he announced earlier. The core objective will likely be to sustain the tariff truce agreed last October, explore additional bilateral concessions where incentives align, and strengthen cooperation on select geopolitical issues."

"Recent headlines that likely reflect posturing by both sides ahead of the visit will not derail stabilisation efforts, in our view. Rather, the visit could prevent renewed escalation at a time both sides face costs from higher trade barriers and supply-chain disruptions, with trade in non-sensitive sectors remaining the most actionable areas for near-term deliverables."

"The approach from both sides may continue to be pragmatic and transactional. The preparation meeting in Paris in March appeared focused on trade issues."

"Last year’s Busan truce could serve as a blueprint, with both prioritising items that can be implemented through administrative actions (e.g., tariff relief, market access, export approvals, targeted purchases) rather than sweeping commitments."

"Possible outcomes include tariff reduction on selected products and an extended suspension or calibrated easing of specific non-tariff restrictions by the US, and incremental Chinese purchases of certain US goods (agriculture, energy, aircraft), alongside continued Chinese supply of critical minerals."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)