US, China buy time with trade truce as pressure builds

US President Donald Trump and Chinese counterpart Xi Jinping wrapped up a highly formal summit in Washington, with the US leader announcing two additional meetings scheduled for this year. While the two nations may have secured a short-term reprieve through a renewed trade truce, experts caution that time is running short for the world's largest economies to resolve their deep-seated rivalry.

The summit, held on Friday, saw Trump confirm plans for two more meetings in the year ahead. Despite the cordial atmosphere, their countries remain locked in a fierce competition across various fronts, including trade, technology, Taiwan, defense, rare earths, and industrial policy, as noted by Daniel Russel of the Asia Society Policy Institute.

A former US official, Daniel Kritenbrink of The Asia Group consultancy, emphasized that both leaders would likely want to maintain stability in the relationship through the end of the year, but tangible progress remains essential for the truce to endure. Beijing's adherence to its commitments from earlier meetings has come under scrutiny, with US officials expressing frustration with China's actions.

The trade truce, initially struck last year during a meeting in South Korea, saw Beijing commit to purchasing more US agricultural products and suspending restrictions on rare earths for a year. The agreement was set to expire in November but was extended until January 10, according to US Treasury Secretary Scott Bessent. Critics argue that extensions serve as mere compliance periods, with China doing just enough to keep the agreement intact.

US trade officials view the extension as a sign of Washington's concern over Beijing's delivery of rare earth magnets, with a desire to maintain the truce on a "short leash." While some progress has been made on other economic fronts, analysts remain skeptical about the sustainability of the truce. Discussions on AI-related threats between the two nations, set to be addressed through an artificial intelligence notification system, are expected to present challenges in defining triggers for such alerts.