US-China Trade Tensions Escalate
China has accused the United States of provoking "new economic and trade friction" after US President Donald Trump claimed that Beijing had violated a trade agreement between the two nations. The Chinese Ministry of Commerce stated that China had "strictly implemented" the consensus reached in trade talks, while accusing the US of taking steps that "seriously undermine" the agreement.
China’s Response to US Accusations
The Chinese Ministry of Commerce said in a statement that the US had unilaterally provoked new economic and trade friction, tightening the uncertainty and instability of bilateral economic and trade relationships. China warned that if the US continued to undermine its interests, China would take determined and powerful measures to protect its legitimate rights and interests.
Trump’s Claims of Chinese Violations
The comments came after Trump claimed on Friday that China had "completely violated" its agreement with the US. Trump said that he had made a quick agreement with China to "save it from what I would consider to be a very bad situation". The US President added that China was not living up to its commitments, and that the US would take action to protect its interests.
Rare Earth Minerals Dispute
A key point of contention is China’s control over the export of rare earth minerals, which are essential for the production of many high-tech products, including iPhones and electric vehicles. The US had expected China to ease its export restrictions on these minerals as part of the trade agreement, but China has refused to do so. Instead, China has imposed export controls on seven minerals and associated products, requiring government approval for each shipment.
Escalating Tensions
The dispute over rare earth minerals is just one aspect of the escalating trade tensions between the US and China. The US has restricted critical technology sales to China and limited the number of Chinese students studying in the US. China has responded by accusing the US of introducing discriminatory and restrictive measures, including guidelines for the control of AI chip exports and the cancellation of Chinese student visas.
Economic Consequences
The trade tensions are having a significant impact on the economy, with China’s manufacturing activity shrinking for the second month in a row. The tariffs imposed by the US on Chinese goods are also affecting China’s export market, with the US being China’s largest export market. The Trump administration has set China’s control over rare earth exports as a key test of China’s compliance with the trade agreement.
Future Prospects
The US and China are scheduled to hold further trade talks, but the prospects for a resolution to the dispute appear dim. The US Finance Minister, Scott Bessent, has said that China had held back on some of the commitments it made in Geneva, and that the issue would need to be resolved through a call between Trump and Chinese leader Xi Jinping. China has defended its export control regime, saying it is in accordance with international practices and not targeted at specific countries.
