EDITORIAL: The recent agreement between the United States and China to temporarily roll back tariffs on each other’s goods marks a welcome development in an otherwise tense and ongoing trade war. The tariff reductions, though short-term, offer a brief but crucial moment of de-escalation after months of damaging back-and-forth.
The US has agreed to reduce tariffs on Chinese imports from 145 percent to 30 percent, while China will lower tariffs on US goods from 125 percent to 10 percent. This 90-day truce is certainly a sign of progress and could bring some relief to industries affected by the trade war’s fallout.
Markets have responded positively, with stock indices surging and a general sense of cautious optimism sweeping over global trade circles. This brief reprieve from the chaos of escalating tariffs will no doubt be welcomed by businesses on both sides, and it could have a stabilising effect on supply chains and market confidence. The decision to suspend certain non-tariff retaliatory measures, like export restrictions on rare earth minerals and anti-monopoly investigations into US companies, adds further substance to this temporary deal.
However, as encouraging as this move is, it should not be mistaken for a permanent solution to the deeply entrenched issues at the heart of the US-China trade conflict. The reality is that this truce is more of a tactical retreat than a long-term resolution, and it underscores what has always been true: this trade war was never truly about industrial policy. It has always been about political grandstanding.
The tariffs, which have disrupted nearly $600 billion in bilateral trade, have caused considerable harm to both economies. US GDP contracted, and Chinese exports dwindled, highlighting the collateral damage inflicted by Trump’s strategy.
Yet, this temporary rollback does little to address the fundamental issues that sparked the trade war in the first place: intellectual property theft, forced technology transfers, market access, and trade imbalances. These issues remain unresolved and are likely to resurface when the 90-day window expires.
Indeed, if this deal had been about industrial policy or economic reform, we would have seen more concrete measures addressing these structural concerns. Instead, what we have is a political gesture designed to appease both domestic and international audiences.
For President Trump, this deal is another victory to add to his list of campaign talking points, reinforcing his image as a tough negotiator on the world stage. But in reality, the deal does little to shift the balance of power in global trade or to resolve the underlying issues that have plagued US-China relations for years.
Moreover, there is no guarantee that this temporary truce will lead to a permanent settlement. The rollback of tariffs may have brought some relief in the short term, but the clock is ticking, and it’s far from clear if a more substantive agreement will emerge. Without addressing the core issues — such as China’s unfair trade practices and the deep trade imbalances — this truce could very well be nothing more than a brief pause in a cycle of escalation and retreat.
It is also worth noting that while the US has agreed to a partial rollback, it has left some of its most contentious tariffs in place. Tariffs related to fentanyl and other specific issues will remain, underscoring that even in the midst of this temporary détente, many of the flashpoints of the trade war remain unresolved. These are not issues that can be solved in 90 days or even in the next round of talks; they are fundamental aspects of the US-China relationship that require careful negotiation and long-term solutions.
Therefore, while this truce is a positive development and a step towards stabilising the US-China economic relationship, it is important to remember that the core issues at the heart of this trade war remain unresolved. The US and China must still find a way to address the deep structural imbalances, intellectual property concerns, and geopolitical tensions that have driven their relationship to this point. Until those issues are tackled head-on, the trade war will continue to be more about political posturing than meaningful economic reform.
In this light, the US-China trade truce should be seen for what it is: a temporary break in a much larger political drama. While it may provide short-term relief, the long-term challenges remain. The trade war, at its core, was never solely about economic policy. It has always been about power, prestige, and political grandstanding. The real test will be whether this brief respite leads to a genuine resolution, or simply another chapter in a longer saga of trade disputes.
Copyright Business Recorder, 2025
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