Winning the Competition, Not the Negotiation: Reflections on the Trump-Xi Summit

On May 15, 2026, President Donald Trump returned from his state visit to the People’s Republic of China (PRC). It was the latest chapter in Trump’s longstanding pursuit of a trade deal with Beijing. During a gaggle on Air Force One, members of the press asked Trump if he and General Secretary Xi Jinping discussed tariffs, the president’s signature China policy. He responded: “I would say we discussed almost everything except the reduction of tariffs.”¹

It is too early to fully judge Trump’s China policy. The trade truce that Trump and Xi brokered in November 2025 remains in place for another few months. Even so, Trump is short on time to solve one of the most complex foreign challenges of his presidency: reshaping America’s economic relationship with China.

Presidential foreign policy is judged on three criteria: execution of stated priorities, response to strategic surprises, and problems left to the next administration. There are no perfect scores. A passing grade is praiseworthy in national security. Presidents are typically judged by their crisis leadership, not by the agenda on which they campaigned before assuming office or the loose threads they leave behind. International politics is a business not of world transformation, but of crisis management.

What follows is a brief summit recap and, more importantly, an examination of the summit’s economic dimensions along these three metrics of judgement. Trump deserves credit for doing more than any other president to adjust America’s outdated China policy during his first term. In his second term, however, the record is mixed. While the Chinese Communist Party (CCP) competes to win a new cold war with the United States, Trump continues to pursue an economic deal while eschewing great power competition. The president is in danger of failing in achieving his own objectives, mismanaging strategic risk, and leaving the bulk of the work undone. I offer this analysis with optimism that time remains not only for the administration to pass, but to ace the China challenge.

The Summit 

The economic deliverables from Beijing were a sideshow. China agreed to an initial purchase of approximately 200 Boeing aircraft, well below market expectations. Renewed beef import licenses for American farmers, resumed U.S. poultry imports, and increased agricultural purchase commitments are positive, but they rely on follow-through from a government famous for delay and prevarication. The formation of Boards of Trade and Investment were interesting, but difficult to judge. Both initiatives may be little more than rebranded economic dialogues that previously existed. Time will tell. Details aside, the summit revealed that Trump still believes an economic deal with China is achievable. It is on this question that the president’s China legacy hinges. 

Trump’s China Agenda: Trade

As far back as 2015, then-candidate Trump blamed the PRC for “the greatest theft in the history of the world”—namely, stealing American jobs, industry, and technology. “We can’t continue to allow China to rape our country, and that’s what we’re doing,” he bellowed at a rally in Indiana. “We’re going to turn it around, and we have the cards, don’t forget it. We have a lot of power with China.”² These dual beliefs—indignation at China’s exploitation of America and belief in his own ability to even the scales—have motivated Trump’s approach to America’s most consequential geopolitical relationship in the 21st century.

A decade later, Trump put the full force of America’s leverage to the test. What began on April 2, 2025, as “Liberation Day” tariffs escalated over the following months into a full-blown trade war between the United States and the PRC, with Washington’s tariffs as high as 145 percent and Beijing’s peaking at 125 percent.³

On this first point, Trump’s logic is largely sound. Nearly 20 percent of China’s gross domestic product relies on exports. In 2023, roughly 120 million jobs in China—nearly a fifth of the country’s work-force—were in manufacturing. More specifically, 10 to 20 million Chinese workers rely on exports to the United States, Goldman Sachs estimates.⁴ Xi Jinping’s preference for production over consumption means he cannot quickly engineer an economic pivot to insulate the world’s second-largest economy from U.S. tariffs.

Crisis Management: Supply Chain Leverage

The PRC retaliated in April 2025 by throttling rare earth exports to the United States. Washington raced to find a diplomatic off-ramp, but it also set about expunging China from its critical mineral supply chains. The administration deserves credit for responding with appropriate urgency, particularly with its support for MP Materials.⁵

The single most important question in assessing Trump’s China policy arises from this crisis: did the president bait Xi into leveraging critical minerals in April 2025, or was he blindsided by Beijing’s escalation? If it was intentional, then the president deserves credit for compelling Xi to fire ammunition prematurely. Having time to decouple critical mineral supply chains before a Taiwan crisis is infinitely preferable to the alternative. It would also suggest that the president has a broader scope and more strategic ambition toward the PRC than is widely believed.

Unfortunately, the evidence suggests that Trump did not anticipate or plan for Beijing’s weaponization of strategic supply chains. “Liberation day” was not targeted toward China, but globally scoped. Moreover, Trump could have prioritized derisking rare earth supplies from Beijing without waiting for Xi to force the issue. The administration waiting until after Beijing’s retaliation to couch the president’s tariff agenda as China-focused suggests post hoc narratives instead of premeditated action.⁶ Beijing’s leverage has cast a shadow over Trump’s China policy in other areas. After threatening to hit any country with a 50 percent tariff for aiding Iran militarily, the president walked away from that policy after evidence emerged that China was doing just that.⁷

Again, time remains on the clock. If current trends continue, however, historians may judge Trump harshly for failing to count the cost before launching a trade war against the world’s second-largest economy. More fundamentally, they may also fault him for viewing the CCP primarily as an economic problem, rather than a strategic challenge.

What Remains: Great Power Competition

Trump is thinking too small in his approach to China. The challenge is systemic, not confined to a single domain like trade. Moreover, the economic domain is zero-sum in nature. If Xi’s dual circulation policy, the party’s military-civil fusion strategy, and the industrial scope of “Made in China 2025” have not convinced policymakers of that reality yet, I shudder to think what will. If the president were viewing the relationship as a competition, his administration would be sprinting ahead to decouple America’s supply chains in other critical sectors like pharmaceuticals.⁸ The administration would also be moving urgently to stop Beijing’s gambit to attract drug discovery and biotech industry away from America to China.⁹ If Washington waits for a crisis to arrive as it did with rare earths, it may be too late.

Trump would also be approaching artificial intelligence (AI) differently. Instead of approving sales of advanced AI chips to China—chips of such a quality that Huawei reportedly cannot produce anything comparable until the end of 2027—the administration would be locking down export controls to protect America’s compute advantage.¹⁰ The United States cannot win the all-important AI race by solving problems for our adversary that it cannot solve for itself.

The contrast is striking. While America offers computer chips to the CCP with open hands, the PRC limits our access to refined rare earths. That asymmetry reflects the core difference between Trump and Xi. Trump has always believed that a win-win deal between America and China is possible. Meanwhile, Xi is angling to win a new cold war.

A More Realistic Post-Summit Agenda

Instead of chasing a deal, Trump should pivot toward his own version of Xi’s strategy and pursue an expedited decoupling agenda that is broader than a single industry. America’s top economic priority with China is to reduce its exposure to Beijing in the event of a crisis. This means:

●      Eliminating kill switches in U.S. critical infrastructure, like data centers, that could be leveraged for power oscillation attacks on the power grid;

●      Derisking key supply chains such as pharmaceuticals—specifically active pharmaceutical ingredients (APIs)—and building up an API stockpile;

●      Keeping sensitive industries like biotechnology from moving across the Pacific;

●      Heading off rising competitors like CXMT and YMTC in strategic industries like memory chip fabrication;

●      Enforcing outbound investment prohibitions to dramatically cut U.S. investment in PRC companies involved in military-civil fusion;

●      Protecting America’s AI compute edge by denying export licenses for advanced AI chips to China and expanding semiconductor manufacturing equipment (SME) controls to hobble Beijing’s domestic chip building industry;

If Trump continues to believe a mutually beneficial deal with the CCP is possible, he will give Beijing the one thing it needs more than capital and technology: time. The United States needs its elected officials to recognize the leverage it holds over the party and to begin using it—not to resolve a trade war, but to win a cold war.