Tariff War Continues! Trump and Xi Jinping Are Playing a Game of Chicken on Negotiation.png

The ongoing tariff conflict between the United States and China has entered a high-stakes phase, with both President Donald Trump and Chinese President Xi Jinping refusing to yield. Despite mounting economic consequences, the two leaders remain entrenched in what experts are calling a "game of chicken" each waiting for the other to initiate dialogue.

On April 2, President Trump reignited the tariff war by imposing a sharp hike in import duties on Chinese goods. While many nations received a 90-day pause from the new measures, China was notably excluded. This move escalated tensions, prompting Xi Jinping’s government to retaliate swiftly. Beijing responded with a dramatic 125% tariff on U.S. imports, directly challenging Washington’s 145% levy on Chinese goods.

Xi Jinping’s Stand: No Negotiation Without Respect

In a pointed statement, Zhu Guangyao, former Chinese Vice Minister of Finance, declared that China will not engage in any negotiation unless the U.S. shows genuine respect. “If the U.S. wants China to totally accept its proposal and conditionalities, then there is no negotiation,” he stated.

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Xi Jinping echoed similar sentiments, emphasizing China’s commitment to self-reliance and its refusal to succumb to foreign pressure. "China is not afraid of unjust suppression," Xi remarked, reinforcing the government's hardline stance on tariffs.

Trump Demands the First Move

From the American side, Trump has been adamant that the next move must come from Beijing. Despite backchannel efforts and technical communication between the two countries, the Trump administration insists that Xi Jinping should request a direct call with Trump. According to senior U.S. officials, this demand has been repeatedly conveyed to China, but has so far been ignored.

“China wants to make a deal. They just don’t know how to go about it,” Trump remarked at a recent White House briefing. His administration remains skeptical of engaging in talks unless China makes the first gesture.

Economic Fallout and Strategic Maneuvers

The escalating tariff tensions have already impacted global markets, with the crypto sector experiencing a brief sell-off. The total crypto market cap dipped 2.5% in the days following the announcement of increased tariffs.

Moreover, China’s decision to halt the purchase of American aerospace equipment, including parts from Boeing, signals a broader strategy to exert economic pressure. There are also reports of Beijing considering a shift to Brazilian agricultural imports, sidestepping American producers.

Despite these aggressive postures, there’s evidence that both nations are exploring indirect paths to negotiation. Unofficial intermediaries like Elon Musk have been used in efforts to reestablish dialogue, but these channels have yet to produce tangible results.

A Dangerous Stalemate

The absence of high-level dialogue is fueling uncertainty. Some U.S. officials suggest that Xi Jinping is wary of appearing weak by initiating talks, while others believe the real issue lies in protocol and trust. The Trump administration’s refusal to accept Chinese Foreign Minister Wang Yi as a trusted interlocutor further complicates matters.

Behind the scenes, both governments are weighing the political and economic costs of prolonged confrontation. As one former U.S. official warned, if China moves to restrict rare earth mineral exports or dump U.S. treasury bonds, the conflict could spiral into an unprecedented economic war.

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Who Holds the Leverage?

While Trump appears to have taken the upper hand in trade negotiations, Xi Jinping has strengthened his domestic position, potentially enabling him to withstand prolonged economic pressure. Experts remain divided on which side holds the true leverage.

Former White House advisors Matt Pottinger and Liza Tobin describe the standoff as a “zero-sum contest” with no clear end in sight. Trump seeks to secure broader commitments from China, including increased exports, TikTok restructuring, and a crackdown on fentanyl trafficking. Meanwhile, China remains focused on strategic autonomy and long-term resilience.

Final Thoughts

The current tariff standoff between Trump and Xi Jinping is more than just a trade dispute—it’s a reflection of deeper geopolitical rivalry. As both leaders dig in, the path to resolution becomes murkier. Whether through backchannels or an unexpected gesture, the world is watching closely to see which superpower blinks first.

FAQ

What triggered the current tariff war between Trump and Xi Jinping?

The current tariff war was reignited on April 2, 2025, when President Donald Trump imposed increased tariffs on Chinese imports. While other countries received a 90-day reprieve, China was excluded, leading to a retaliatory 125% tariff on U.S. goods by China.

Why is Xi Jinping refusing to negotiate with the United States?

Xi Jinping’s administration has stated that it will not enter negotiations unless the U.S. approaches talks with mutual respect. Chinese officials view the current American stance as confrontational and have called the tariff increases a form of blackmail.

How is the tariff war affecting global markets and trade?

The prolonged tariff conflict between the U.S. and China is creating economic uncertainty, disrupting global supply chains, and affecting major markets, including the crypto sector. Some U.S. companies face the risk of being blacklisted in China, while alternative supply partnerships are being formed globally.