China says US is ‘provoking frictions' as tensions flare despite trade truce

Yahoo

2 days ago

China has accused the United States of 'provoking new economic and trade frictions' as it responded to US President Donald Trump's claims that Beijing had violated a trade truce agreed by the two nations last month, which paused their blistering tariff war.
China was 'strictly implementing' the consensus of those trade talks, the Chinese Commerce Ministry said in a statement Monday, while blaming the US for taking steps that 'seriously undermine' the agreement.
'The United States has been unilaterally provoking new economic and trade frictions, exacerbating the uncertainty and instability of bilateral economic and trade relations,' the statement said.
'If the United States insists on its own way and continues to undermine China's interests, China will continue to take resolute and forceful measures to safeguard its legitimate rights and interests,' it added.
The comments come after Trump on Friday said China had 'TOTALLY VIOLATED ITS AGREEMENT WITH US.' In a post on Truth Social, the US president said that he made a fast deal with China to 'save them from what I thought was going to be a very bad situation.' He added: 'So much for being Mr. NICE GUY!'
The back and forth spotlights a ratcheting up of tensions between the US and China just weeks after the two sides reached the surprise trade truce in Geneva, which significantly dialed down the hefty tariffs that each imposed on the other in April.
That agreement gave the two sides a 90-day window to hash out a broader deal, an effort that now appears imperiled as each side accuses the other of working against the spirit of that agreement. US officials have described talks as 'stalled' and suggested that the involvement of Trump and Chinese leader Xi Jinping is needed to jumpstart progress.
A key point of contention has been Beijing's export controls on rare earth minerals and associated products, which were imposed as part of its retaliation against Trump's 'reciprocal' tariffs on Chinese goods.
Following the talks, US officials had expected China to ease export restrictions of those minerals, which are an essential part of everything from iPhones and electric vehicles to big-ticket weapons like F-35 fighter jets and missile systems.
But the restrictions haven't been lifted, causing intense displeasure inside the Trump administration and prompting a recent series of measures imposed on China, three administration officials told CNN last week.
Meanwhile, Beijing accused the US last month of 'undermining' the consensus reached in Geneva, after Washington warned companies against using AI chips made by its national tech champion Huawei.
In a further escalation of tensions, the US then last week also moved to limit critical technology sales to China and restrict the number of Chinese students studying in the US –spotlighting how the scope of their competition is much broader than just trade.
In the Monday statement, China's Commerce Ministry hit out at these measures, saying the US has 'successively introduced a number of discriminatory restrictive measures against China after the Geneva Economic and Trade Talks, including issuing AI chip export control guidelines, stopping the sale of chip design software to China, and announcing the revocation of Chinese student visas.'
Beijing, as well as other Asian capitals, is also feeling the pressure of trade frictions at home. China's manufacturing activity shrank for a second month in May, an official survey showed on Saturday. Tariffs imposed this year on Chinese goods entering the US, its largest export market, currently stand at 30%, not including any pre-existing duties.
Trump administration officials have homed in on China's controls on exports of rare earths in their assessments of China's compliance with the agreement reached in Geneva.
The deal saw the two sides dial back during the 90-day grace period mutual tariffs that had soared to well over 100%. It also included an agreement from China to 'suspend or remove' non-tariff countermeasures taken against the US since April 2.
China on April 4 imposed export controls on seven rare earth minerals and associated products in what was seen as a retaliation against Trump's duties on its goods. Its export control regime does not ban exports outright but requires government approval for each shipment regardless of destination, enabling greater control over a supply chain that China has come to dominate globally. That system appeared to remain in place last month following the talks, CNN reporting showed.
During an interview that aired Sunday with CBS' Face the Nation, US Treasury Secretary Scott Bessent said China was 'withholding some of the products that they agreed to release' in Geneva, referring to critical minerals.
'Maybe it's a glitch in the Chinese system, maybe it's intentional,' he added, noting that the issue would be 'ironed out' when Trump and Chinese leader Xi Jinping have a call, which Bessent said he believes will happen 'very soon.'
The two leaders are known to have last spoken on January 17, days before Trump's inauguration.
China has defended its export control regime, describing it last week as 'in line with international practices' and 'not targeted at specific countries.'
When asked about its export controls on rare earth minerals, part of a wider category of critical minerals, during a regular press briefing Friday, a spokesperson for China's Ministry of Foreign Affairs said Beijing was 'willing to strengthen dialogue and cooperation in the field of export controls with relevant countries and regions.'