Trump in Beijing: Can tariffs and trade talks reset US–China relations | This is America

Added: 2026-05-17

[00:00:09]This is America, where what started as ping pong diplomacy with China has now developed into what Donald Trump calls a close [music] friendship. But the two countries are currently in a fragile trade truce. Donald Trump is in Beijing with the hope [music] of cementing that.

[00:00:23]I'll have more on that later in the show, but to start us off, here's Cyril Vanier in our Washington [music] studio.

[00:00:29]Matt Galloway, thank you. Here's how Donald Trump views the US's trade relationship with China. It's a rip-off, and he's on the wrong end of it. The president believes this partly because Americans buy more from China than the other way around, the trade deficit that he rails against, and partly because China, like the US, doesn't always play fair in business, using all of its tools to secure economic advantage. As Trump visits Beijing for the first time in nearly nine years, looking for a win, we ask what that looks like and how to get it.

[00:01:01]But China needs us much more than we need them. World Trade Organization, which was owned by China. It was owned and paid for by China. They were making from us a trillion dollars a year. They were ripping us off like nobody's ever ripped us off. And by the way, we have other countries that were just as bad. I have a great relationship with President Xi.

[00:01:22]We're doing a lot of business, but it's smart business. We used to be taken advantage of for years.

[00:01:28]So, on some issues, Donald Trump can be unpredictable. His views can change over time. On trade, specifically US trade with China, as you just heard, the opposite is true. The US president has been very consistent that Washington must confront Beijing. Al Jazeera's Patty Culhane takes us through the twists and turns of the last 12 years.

[00:01:49]Two years into his first term, US President Donald Trump launched the first salvo in the trade war. Today, I'm defending national security by placing tariffs on foreign imports of steel and aluminum.

[00:02:04]In his first term, the tariffs were targeted. That all changed in his second term.

[00:02:09]>> I mean, I'm just I'm just doing what's fair. This is a very fair thing. Every embassy in Washington has had to deal with tariffs in one way or another, but none more so than China. It all started in February of last year when US President Donald Trump put a 10% tariff on all goods coming from China into the US. China responded and putting tariffs of 10 to 15% on some goods. The rates peaked in April. US putting up tariffs as high as 145% from the Chinese side, 125%.

[00:02:41]But then the two countries reached a deal. The current US tariff rate believed to be just over 23%. The Peterson Institute puts the average tariff rate China has put on US goods and services at just under 32%.

[00:02:55]Chinese officials letting their actions speak louder than their words.

[00:03:00]As the situation unfolds, the mutually detrimental consequences of tariffs have become increasingly evident, while calls for the preservation of free trade have grown ever more insistent.

[00:03:11]Still, the numbers show the tariffs are having an impact when it comes to the trade deficit between the two countries.

[00:03:17]The deficit is the difference between what China exports to the US versus what the US sells to China. When Trump first imposed tariffs in 2018, the US trade deficit with China was just over $418 billion, staying in the 300 to 400 billion dollar range for a few years, but it has been dropping. Even though still sizable, the difference was just over $202 billion last year. As President Trump left for the trip, one of the big questions, will the trade truce continue? The answer will likely have a huge impact on the world's two biggest economies. Patty Culhane, Al Jazeera, Washington.

[00:03:59]And joining me in the studio now, Mary Lovely, the Anthony M. Solomon Senior Fellow at the Peterson Institute for International Economics.

[00:04:06]Also with us, Doug Bandow, former special assistant to President Ronald Reagan. To both of you, is China ripping off the US as Donald Trump says?

[00:04:16]There have certainly been cases where the where China has used US technology.

[00:04:20]And I think it was much more of a problem before. China is now an innovative nation itself, and it has strengthened its laws against intellectual property theft. So, this complaint, at least among the country companies that are still operating there, has really moved down the list of their major worries about operating inside China. Doug Bandow?

[00:04:42]Yeah, there's been issues in terms of IP, intellectual property protection, the issues of technology that's been stolen or taken and reused. Those are serious and genuine issues, but that's really not what the president is focused on. He focuses on things like the deficit. And the trade deficit is not a rip-off. I mean, we're getting a lot of products at fairly good prices from China. That's a benefit to American consumers. You were an advisor to President Ronald Reagan. Did Reagan worry about China?

[00:05:09]Reagan worried about China more geopolitically.

[00:05:12]I mean, he was an anti-communist. He came out of the Cold War. No, I mean, specifically economically, in terms of the trade relationship. Well, he wanted to have a good trade relationship, but this is a very different China. We're talking back in 1980. China was not the massive, the colossus that it is today.

[00:05:28]So, the economic side was much smaller, and the hope was to attract China by bringing it into the economic system to help change it politically, and to bring it closer to us against the Soviet Union. So, he had a very different set of concerns about China. How did China become what it is today? Because 20, 30, 40 years ago China was seen as producing it was sure it was the world's manufacturing center but it was seen as producing, you know, cheap products, low value products. That is not the case anymore. What changed? How did it get to here? Yeah, well as Doug just mentioned it was a it was a vastly different country back in the 1980s. Starting in the mid-1990s in particular, it really reformed. It reformed its state-owned enterprises. It put over a million workers off their jobs.

[00:06:17]Um it freed up prices. So, you know, before prices were set by the state and it let prices then reflect relative scarcity.

[00:06:26]And um it allowed for the movement of people from the countryside to the urban areas. So, the largest in, you know, uh domestic migration in history really.

[00:06:38]And on the trade side its enter into external markets or global markets was very unique. It really was dominated by multinational enterprises which either set up businesses there in special enclaves known as special economic zones. Um and this trade really dominated particularly the US-China relationship.

[00:07:00]Uh that has vastly changed over the last uh 15 to 20 years. Doug Bandow, China could and does argue that, you know, both countries have very sharp elbows when it comes to protecting their economies and creating using all of their tools at their disposal to create space for their economies and their industries to thrive. In fact, China also saying that it is sometimes bullied by the US which no later than last year imposed 145% tariffs on it. Does China's argument have merit?

[00:07:32]Well, China is certainly correct that the US is willing to use its economic power and the US is no innocent when it comes to international trade. I think the difference here is that we basically have a Leninist state in China that can use private power in a very different way. They They can drive their businesses towards political ends.

[00:07:53]Xi Jinping has been very much pushing on that, re- kind of recreating party cells at companies, making punishing private companies that go the wrong way. Even this US president doesn't have that kind of a power. So, China has a unique ability to kind of use the private resources of the economy for coercive purposes.

[00:08:14]>> I was going to say, doesn't the US do a version of that? You know, an American version of what you just described?

[00:08:21]Of forcing our >> Of using government power, influence, muscle to advance the interests of its private corporate champions. Overseas?

[00:08:30]Yes. Well, we've always had export promotion.

[00:08:34]Um, I think that what you're basically gearing toward is really using economic power for economic coercion. And the US has done that. The US is really the pioneer of using uh what some people call our underground empire, which is, you know, our formidable control of global finance, for example. Um, but, you know, we've always said, "Yeah, but that's because we're the good guys.

[00:08:57]We're on the side of the good guys." And we've always had I mean, in many of these cases, we've had a large coalition of countries that also agreed with that position. I think with the so-called liberation day that we saw last year when President Trump really announced a trade war on all of our trading partners, that's where a big split really, you know, came to fruition between us and what we usually think of as our partners and friends. So, we've set the stage. We've given a little bit of the history, recent and and not so recent. I want to get stuck in on this trip now and what Donald Trump can do in Beijing, what he hoped to he can hope to achieve, and and how you get to an economic win from the perspective of the US president. The trade imbalance between the US and China is something he's very big on. America imports far more from China than it exports, making it somewhat dependent on Chinese goods.

[00:09:49]So, here are the numbers. The US imported $308 billion of goods from China in 2025. That's nearly three times the $106 billion of goods that it exported to China in the same year. So, 300 billion exports, 100 billion roughly uh I beg your pardon. 300 billion imports, 100 billion exports. Part of the reason it's an issue for the US is the type of goods that it imports. We're talking mass-produced electronics, machinery, clothing, things that the American public now depends on. American companies source from China to keep their prices down.

[00:10:23]The US, on the other hand, mainly exports big-ticket items. So, we're talking semiconductors, aircraft, chemicals. These more complex products command higher prices. And for American companies, that means more profits. It also allows them to pay their employees higher wages.

[00:10:38]Doug Bondo, how worried do you think the US president really should be about the trade deficit? Because he has made it the center of his policy, of the center of his vision with with the US-China trade policy. For him, it's all about deficits, trade deficits.

[00:10:55]>> deficits, this is an accounting number.

[00:10:57]It really doesn't tell you very much.

[00:10:59]You know, the pro- point is, unless they burn the money, that uh you know, I mean, the point is that money comes back. And what do you do with it? They either spend it or they invest it. You know, so from our standpoint, it really doesn't matter an awful lot which country where has a deficit or not. Are we getting good products at reasonable prices? It's fair to be concerned, I think, about de-risking. That is, do we want to be overly dependent upon a a country that we especially have some political issues with for, say, protective gear or for pharmaceuticals or for semiconductor chips. And there's of these issues, I think, are important, but they're much narrower than just the broad sense of, well, how much do we, you know, buy from them? Chinese are much poorer than America. The reality is Americans have higher incomes. We're going to spend more than Chinese consumers are. Mary Lovely, Donald Trump makes this the center, right, of attention, center of focus on the US's relationship with China. It's all about, in his telling of it, trade deficits. Do you Do you agree with Doug that it it shouldn't be?

[00:12:00]I think the overall trade deficit might be something we want to think about, but that's not the way the Trump administration uh is approaching it.

[00:12:07]They're approaching on a bilateral. So, they want to make sure that sort of, you know, your purchases and your sales in every country, you know, net out to zero. That's just just kind of crazy.

[00:12:19]It's like I have a trade deficit with the grocery store, but I have a surplus with my employer who pays me. It's the same thing. We go to certain countries for critical minerals. We go to other countries for manufactured goods. So, I agree with Doug. The real issue here on our dependence on China is really about where is China dominating in certain goods that we absolutely need. Critical minerals is, of course, something that has been discussed a lot lately, and I think most people are familiar with.

[00:12:48]It's clearly something we should be working on. The overall trade deficit with China has been decreasing. China's exports as a share of all of our imports was about 22% before the first trade war. Now it's down quite a bit to nine.

[00:13:01]Are we safer if we still have 90% dependence on them for critical minerals that we need for our cars and for our armaments? I think the answer to that is no. So, you They need to be focusing on resilience and security, and not this overall number. If they're really serious about dealing with the trade deficit, they should be looking at the large federal budget deficit. The The deficit, by the way, specifically the trade deficit with China has has been halved from Trump's first term to second term. It was about $400 billion a year during Trump's first term, more or less, to down to 200. Does that mean that Trump's policies are working towards China? He's achieving what he wants.

[00:13:38]Doug.

[00:13:39]Well, >> [laughter] >> if he wants to get the deficit down and that's all he cares about, then maybe he's made some achievement. Though it's not clear this past year he's had much success on that.

[00:13:49]But again, if you're going after the wrong variable, you know, rare earths matters a lot. And that matters not only for kind of our semiconductor you know and other electronics, but it matters for defense. We are critically dependent on them, but we don't have to be. In fact, rare earths are not particularly rare. It's just that China dominates that market. We want to maintain the kind of command of the the commanding heights of technology, semiconductor chips, AI.

[00:14:15]Those are the things we need to focus on. And I worry that Donald Trump, he's very interested in getting soybean orders. Well, I love farmers. I hope they get soybean orders. But if the question is where do you focus your effort? Well, you know, what is your measure of success? I'd say it's semiconductor chips. It's rare earth.

[00:14:31]It's not soybeans. So you've both mentioned rare earths and how important that was. A couple of numbers here for viewers. So the US is more dependent on Chinese supply chains than the other way around, which you've heard both Mary and Doug say. Rare earths is the prime example here. China is the largest producer in the world by far. It mines about 70% of the world's rare earth minerals. It also processes 90% of rare earth magnets. They have significantly higher magnetic strength and heat resistance. So that makes them a key component in building motors, sensors, robotics, crucially defense technologies, a whole range of products that the US uses, needs, and builds.

[00:15:07]Uh and that is not the only number um that we have. It's not the only sector where China wields significant control. The US currently sources around 25% of its active pharmaceutical ingredients directly or indirectly from China. So there's pharmaceuticals. And Beijing controls about half the global production of printed circuit boards.

[00:15:26]These are the critical building blocks for electronics of all kinds.

[00:15:30]Mary Lovely, when when the US and China were at the peak of their trade war and the US was imposing 145% tariffs on Chinese goods, on Chinese imports, China responded by choking off the export of rare earths to the US. And that's when Donald Trump stopped with his tariffs. It seemed that the US has no answer to this.

[00:15:51]Right now, the US doesn't have any answers to this. I would argue that all of the products that you mentioned are not equally important. If If we have close substitutes or if we can, uh, you know, ramp up production very quickly as we did with protective devices during during, uh, COVID, then it's really not a problem. We have to look at the things, particularly capital-intensive types of production processes like mining and refining, that would take a very long time for the US to find a substitute for either domestically or foreign. So, there are some products that are are really vitally important and we need to focus on those.

[00:16:25]Um, Does that mean maybe don't punch them in the face with 145% tariffs if if they can do the same to you? Yeah, I mean, it it's kind of shocking that the president's people didn't know this going in. We all knew this was a possibility. The Chinese now having pulled that card and seeing the US pull back are very confident. They're going into this latest summit very confident that they have a so-called Trump card in this. Um, which they, you know, they used again later in the year, uh, where they tried to have extraterritorial application of their own controls. So, they're taking a lot of pages out of our playbook and turning around and using it. And, um, you know, we have to have response to that, but it needs to be a wake-up call, not to focus on things like bilateral trade deficits, which are just going to move the US deficit around from country to country, and instead focus exactly on the things that are actually going to raise resilience and security. I want to run both of you through the delegation that Donald Trump is taking with him to Beijing. So, the US president has invited a group of billionaires to join him on this China trip hoping that the Chinese President Xi Jinping will further open up the Chinese market to American companies. US officials also say that Trump wants to create a board of investment and a board of trade with China. Biggest names in the US delegation are as follows. Apple, no surprise, represented by Tim Cook.

[00:17:45]China is central to Apple's manufacturing.

[00:17:48]Uh they also reportedly want to increase investment in Chinese research centers and renewable energy projects. Tesla's Elon Musk is there, too. The world's richest man, he has deep business interests in China. Much of Tesla's car and battery production is based there.

[00:18:03]Meta's president and vice chairman Dina Powell McCormick is there. Meta is an interesting one because just last month Chinese authorities ordered that Meta halt its $2 billion acquisition of Chinese firm Manice AI. Boeing is part of the US delegation with CEO Kelly Ortberg. Uh China has not bought Boeing airplanes in large numbers in nearly a decade, but that could be about to change. Boeing is reportedly on the verge of announcing a Chinese order of 500 airplanes. And one more thing, last-minute addition to the trip, Nvidia. As the world's biggest AI chip maker, their CEO Jensen Huang has long pushed for greater access to the Chinese market. He says China represents a $15 billion opportunity. So, when you listen to the names of these like these tech giants, these industrial giants for the US that are traveling to Beijing, where do you see the most opportunity? Doug, perhaps you take this one first.

[00:18:55]For for deal making or for some win or positive announcement at the end of the trip?

[00:19:00]Well, I would certainly expect that he wants something for farmers. That's probably going to be soybeans even though he didn't he we don't have a billionaire who's in the soybean trade.

[00:19:09]And it probably means Boeing. This is a high-value, a hot kind of a high-profile product. What I worry about is, yes, that's a win from his standpoint, but for example, rare earths, this is a 10-year project where we need to work with other countries, expand supplies, and especially processing. It'll take time, but at the end of 10 years, we'll be in a position where China no longer has a chokehold. I worry that what we're going to see is, you know, the promise of we were willing to buy some more, uh, say, semiconductor chips. Well, then what are we going to do in terms of trying to protect the advanced semiconductor chips from China? What other concessions will the Chinese, you know, demand?

[00:19:47]You know, the first, uh, Trump term, they basically didn't retaliate a lot.

[00:19:51]They kind of accepted and dealt with Trump. They have learned if you're dealing with Donald Trump, you'd better fight back, and that's where the rare earth came from. And I think that's one reason the administration was surprised is they hadn't found China being so willing to fight back so tough. So, I worry the president's, you know, taking it I mean, what's will be an easy victory for him when he comes back, but I worry about the long term is he kind of missing the most important issues that we have with China on economics.

[00:20:20]Mary, I have a question for you on the intersection of trade and national security. It's going to be on the off the back of this. The US and China compete for economic influence the world over. They want their brands, their companies, their industries to sell and be present everywhere. Here's a specific look at how this rivalry is playing out in Latin America, which Donald Trump sees as the US's economic backyard.

[00:20:43]Manuel Rapalo reports.

[00:20:45]More than 50 years ago, a simple game of table tennis helped thaw relations between the United States and China.

[00:20:52]What became known as ping pong diplomacy opened the door to one of the most important geopolitical relationships of the modern era.

[00:21:00]Today, the tables are turning, and Latin America, home to critical minerals, major shipping routes, and some of the United States' biggest trading partners has become strategically important both to Washington and Beijing.

[00:21:13]If geopolitics had a soundtrack right now, it might sound something like this.

[00:21:17]Because the relationship between Washington and Beijing increasingly resembles a high-stakes rally.

[00:21:23]Fast, competitive, and increasingly difficult to control.

[00:21:29]President Trump is in Beijing this week looking for leverage with trade still at the center of the relationship. Despite years of tariffs and sanctions, China still maintains enormous manufacturing power and a massive global trade surplus.

[00:21:43]And increasingly, Latin America has become one of the key arenas where that competition is playing out.

[00:21:49]China has invested heavily across the region through infrastructure projects, mining, telecommunications, and trade partnerships.

[00:21:57]>> [music] >> Chinese-backed projects across Latin America and the Caribbean are now estimated to be worth hundreds of billions of dollars.

[00:22:05]>> [music] >> In Peru, China helped finance and develop the massive port of Chancay, a deepwater megaport designed to accelerate trade between South America and Asia.

[00:22:16]Chinese companies have also expanded investments in lithium, mining, clean energy, and electric vehicle production across South America.

[00:22:25]Including major projects in Brazil, which has become one of the top destinations for Chinese investment globally.

[00:22:31]The United States, meanwhile, is trying to strengthen supply chains closer to home while warning governments in the region against growing Chinese influence.

[00:22:40]>> [applause] >> But unlike the Cold War era, today's rivalry stretches far beyond Washington and Beijing.

[00:22:47]The playing field has expanded and the stakes have become global.

[00:22:52]Half a century ago, ping-pong diplomacy symbolized a breakthrough between Washington and Beijing. Today, the relationship is no longer defined by a single issue, but by an expanding contest over trade, infrastructure, and global influence.

[00:23:07]The question isn't whether or not China's influence in Latin America is growing, but whether Washington can keep pace with Beijing's expanding footprint in the region. Manuel Rapalo, Al Jazeera, Washington.

[00:23:19]Very lovely. Donald Trump always frames the economic competition with China as a matter of political security. And for sure national security. And for sure some of that is to give himself political cover to do what he wants, the tariffs and other measures.

[00:23:33]What do you think is the real intersection between the economic relations and national security for the US?

[00:23:39]Well, we have to have this discussion, I think as a as a civil society. And you know, I don't pretend to know it all. I think we need to have the security people, the the economists, uh people involved in industrial development in the US to sit down and think about this. Every issue with China is not a national security issue. Uh we have we could cost the American consumer a lot less if we focused just on the things that we think do have national security concern. AI chips perhaps, but not children's rubber boots, which we also have tariffs on. So, I think that there's a lot of winnowing and sort of almost a maturing of our view of China.

[00:24:18]Um they're going to be in places like Latin America. They've been offering patient capital to Latin America, building infrastructure. The US can be a very attractive alternative if we try, but we saw President of Brazil here um for a couple of hours.

[00:24:34]Crickets, not really much happening. So, what is the US offering? What are we seeing as our positive agenda for these countries and for other countries in Asia, frankly. We started that a little bit under President Biden with the Indo-Pacific uh outreach that he did, but we were unwilling to really uh offer the types of investment and trade deals that they really wanted. So, I think we have to decide how important this is and what we're willing to do on the economic side to get these countries on side. All right. That's all the time we have for today. And I want to thank you both for joining us in the studio, Mary Lovely, Doug Bondo. Thank you for your time. Thank you for joining in the discussion.

[00:25:11]And uh that's all from the team here in Washington. Handing back to table tennis extraordinaire, Manuel Rapalo, and Al Jazeera's global headquarters in Doha.

[00:25:22]Thanks, Cyril. Corporations have started receiving tariff funds after they were ruled to be illegal by the Supreme Court, but will any of that money make its way back to consumers who were forced to pay higher prices for goods?

[00:25:33]That's on the next episode of This is America on Thursday at 2:30 [music] p.m.

[00:25:37]Eastern here in the United States or 18:30 GMT. Bye for now.

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