US-China Relations: Trade and Security Tensions Persist

China has expressed concerns that the US "Golden Dome" missile defense system, announced by President Trump, increases the risk of "space becoming a battlefield" and fuels a global arms race. China's foreign ministry spokeswoman said the US plan has "strong offensive implications" and undermines global strategic balance and stability. The system is intended to protect the US from missile attacks and has been allocated an initial $25 billion in funding. Both China and Russia have criticized the plan, with Russia previously stating it would lead to a significant strengthening of its space arsenal.

The US and China held their first call since high-level talks in Geneva, with Chinese Vice Foreign Minister Ma Zhaoxu and US Deputy Secretary of State Christopher Landau discussing key issues, signaling progress in trade talks. The call is seen as a "positive sign" that both sides are maintaining communication and working towards a broader agreement, following a joint statement to temporarily lower tariffs on each other's goods. The US and China have continued to trade barbs, but recent meetings, including one between Ma and new US Ambassador to China David Perdue, suggest Beijing is aligning more closely with the US in trade discussions.

China has hailed a recent truce in the US-China tariff war as a victory, but Beijing is gearing up for tough negotiations ahead. Despite the temporary reduction in tariffs, China's Commerce Ministry has continued to lash out at Washington, accusing the US of undermining the Geneva talks and abusing export controls to suppress China. The 90-day truce, agreed on May 12, reduced tariffs by 1.15 percentage points, but Beijing is unlikely to make quick concessions at the expense of its own image or interests. China's tough stance is driven by a deep mutual mistrust and mounting US-China competition in tech, military prowess, and global influence. While Beijing is likely prepared to make some concessions, such as returning to a trade agreement to buy more US goods or collaborating on curbing fentanyl production, it is also wary of negotiating too broadly with the Trump administration. The stakes are high for China, as a prolonged trade war could cut US-China trade by half, reducing China's growth by 1.6% and leading to four to six million job losses.

A report by the International Crisis Group warns that the US may not be a reliable guarantor of regional security in Asia due to inconsistent signalling under Donald Trump's presidency and Chinese advancements, potentially leading to increased militarisation and an arms race, and calls for the US and China to strengthen military communication channels and engage in high-level strategic exchanges.