In the wake of the highly-anticipated 90-day trade truce between the United States and China, Beijing has begun signalling a tougher posture – setting "red lines" in response to what it describes as unresolved trade fundamentals.
On 12 May 2025, the US and China agreed on a temporary trade truce in Geneva that paused what had been spiralling tariffs, with US duties on Chinese goods cut from roughly 145 percent to 30 percent and China's levies on US imports reduced from about 125 percent to 10 percent.
The deal set a 90-day window for negotiations while maintaining elevated tariff levels, rather than resetting relations. The truce was then extended for another 90 days, deferring imminent tariff hikes until 10 November 2025.
While the truce temporarily eased tit-for-tat tariffs and created space for negotiations, China's recent export control and rare-earth moves suggest it is not willing to concede on key issues. China has pointed to US actions on export controls and tariffs as breaches of the agreement and is preparing measures to protect its supply chain and strategic sectors.
These "four red lines" were named as Taiwan, democracy and human rights, China's political system, and development rights.
As both sides recalibrate their trade strategies, the temporary pause offers little certainty for global supply chains. Trade relations between the world's two largest economies remain fragile, with strategic ambiguity, shifting red lines and policy uncertainty shaping the global economic landscape.