One might be forgiven for experiencing a profound sense of déjà vu when observing the latest developments in Sino–American economic relations. President Trump’s announcement that a trade deal with China had been signed “the other day” carries all the theatrical gravitas of a seasoned performer who has delivered the same lines countless times before. Meanwhile, China’s Ministry of Commerce confirmed Friday that “some type of arrangement” had been reached, though with the sort of studied vagueness that would make a Whitehall mandarin weep with envy.
The current spectacle centres on rare earth minerals, those peculiarly named elements that sound rather like something one might order at an upmarket gastropub but which actually power everything from smartphones to fighter jets. China, which controls approximately 90% of global rare earth processing, has graciously agreed to “review and approve eligible export applications for controlled items.” In return, the United States promises to “lift a series of restrictive measures” it had imposed on China. Such magnanimity from both sides is truly heartwarming.
The familiar dance of diplomatic brinkmanship
What makes this particular round of trade negotiations so deliciously predictable is how closely it follows the established pattern of Sino–American economic diplomacy. First, tensions escalate to seemingly unbearable levels. Then, both sides engage in increasingly dramatic rhetoric about protecting their respective national interests. Finally, a breakthrough is announced with great fanfare, usually involving concessions that could have been made months earlier without the accompanying theatre.
The current agreement builds upon what Trump announced as a “framework” following talks in London on June 11. However, as Jeff Moon, a former trade official who now runs China Moon Strategies, observed with admirable understatement, “Silence regarding the terms suggests that there is less substance to the deal than the Trump Administration implies.” One suspects Mr Moon has mastered the art of diplomatic euphemism.
The timeline of recent events reads like a masterclass in manufactured crisis. In April, the United States imposed so-called “reciprocal tariffs” on China, which Beijing’s Ministry of Commerce characterised as “a typical example of unilateral bullying.” By May, both sides had reached an agreement in Geneva to de-escalate these hefty tariffs, only for that arrangement to collapse when China allegedly failed to lift export controls on rare earths quickly enough for Washington’s liking.
The rare earth gambit
The focus on rare earth minerals represents a particularly sophisticated element in this ongoing diplomatic performance. These materials, with names like neodymium and dysprosium that sound more suited to a chemistry textbook than a trade war, have become the latest weapons in the arsenal of economic statecraft. China’s dominance in rare earth processing gives Beijing considerable leverage, whilst America’s dependence on these materials for everything from wind turbines to military hardware creates genuine vulnerability.
Treasury Secretary Scott Bessent announced Friday that “the Chinese had agreed to make it easier for American firms to acquire Chinese magnets and rare earth minerals.” The phrase “make it easier” carries the sort of bureaucratic poetry that suggests the previous process was rather like attempting to obtain an audience with the Pope whilst wearing a “Down with Vatican” t-shirt.
Yet beneath this latest agreement lies a more fundamental question about the nature of modern trade negotiations between superpowers. The repeated cycle of crisis and resolution suggests that both Washington and Beijing have discovered the political utility of perpetual tension. Each side can claim victory to their domestic audiences whilst maintaining the flexibility to renegotiate when circumstances change.
Beijing’s strategic patience
China’s approach to these trade negotiations reveals a sophisticated understanding of American political cycles and attention spans. The Ministry of Commerce’s warning against “any party reaching deal at expense of China’s interests” demonstrates Beijing’s awareness that other nations are watching this bilateral dance with considerable interest. The message is clear: do not expect China to sacrifice its position for the sake of American tariff relief.
This strategic patience extends to China’s handling of the rare earth issue itself. By implementing a dual-use licensing regime in April that requires exporters to seek approval for each shipment, Beijing created a bureaucratic mechanism that can be tightened or loosened as diplomatic circumstances require. The system allows China to claim compliance with international trade rules whilst maintaining practical control over supply chains.
Moreover, China’s insistence that it has been “speeding up” approvals for “compliant” applications creates the perfect diplomatic cover. Who, after all, could object to ensuring compliance? The fact that many companies continue to struggle with securing sufficient supplies merely demonstrates the complexity of modern supply chains, not any deliberate obstruction.
The American predicament
From Washington’s perspective, the current trade negotiations represent a delicate balance between domestic political pressures and economic realities. Trump’s promise that “magnets and any necessary rare earths will be supplied up front by China” sounds reassuring until one considers the practical implications. American dependence on Chinese rare earth processing did not develop overnight, and it cannot be unwound with a single trade agreement, however theatrically announced.
The July 9 deadline for reaching deals with other trading partners adds another layer of complexity to these negotiations. As Treasury Secretary Bessent noted, countries will be sorted into “proper buckets” on that date, with those lacking agreements potentially facing unilateral tariff increases. This creates an interesting dynamic where China’s cooperation on rare earths becomes part of a broader strategy to demonstrate American negotiating prowess to other potential partners.
However, the repeated nature of these “breakthrough” announcements suggests that both sides have discovered the political benefits of perpetual negotiation. Each agreement provides temporary relief from economic uncertainty whilst maintaining the option to renegotiate when domestic political needs require fresh drama.
A new normal of scripted power plays
Trade diplomacy between superpowers has long abandoned the ideal of lasting agreements. In its place stands a fluid model of perpetual negotiation—where symbolism often trumps substance, and flexibility outweighs finality.
China, wrapped in the mantle of multilateral legitimacy, positions itself as the guardian of “historical correctness,” winning points with the global audience. The United States, meanwhile, frames its combative posture as patriotic vigilance. Both sides extract domestic gains from a theatre of uncertainty that now feels institutionalized.
The real question is no longer whether this latest deal will endure—but how long both sides can keep performing this well-rehearsed play before geopolitical or internal pressures demand a rewrite. Until then, diplomacy will continue to take the stage dressed as trade—rare earths as props, national interests as script.
Sources
- Wiseman, P. (2025, June 28). The new US-China trade agreement, explained. AP News. https://apnews.com/article/trump-china-trade-tariffs-rare-earth-minerals-cbd2482bd2b3a7ce8d47030c4ff1c3d4
- Liu, J., & McCarthy, S. (2025, June 27). US, China formalize deal on rare earth shipments in trade breakthrough. CNN Business. https://edition.cnn.com/2025/06/27/business/us-china-trade-deal-agreement-signed-intl-hnk
- Associated Press. (2025, June 27). US and China sign trade deal, Bessent says. AP News. https://apnews.com/article/china-trade-earths-tariffs-trump-463ae8d6ccba15b56c7d4d31d3fc42a1
- Global Times. (2025, June 28). MOFCOM on US’ push for tariff deals. https://www.globaltimes.cn/page/202506/1337190.shtml
- Bloomberg News. (2025, June 26). Lutnick says US-China trade truce signed, 10 deals imminent. Bloomberg. (Subscription required)