Following months of talks, the United States and China have agreed to further postpone the imposition of large-scale tariffs on each other for another 90 days. The status quo, of the US imposing a 30 percent tariff on Chinese imports, while China imposes a 10 percent tariff on US imports, thus continues as the two parties commit to further negotiations.

This is a constructive outcome that has avoided the worst-case scenario. While it shows that both countries have a vested economic interest in maintaining ties with each other, a relationship that is impossible to overlook for global prosperity and stability, it also shows that Washington clearly has a weaker hand to play in respect to China, which has prevented the US from readily resorting to escalation, as it has with other countries, or quickly snapping up a completely one-sided deal that is best described as “capitulation”.

The US’ trade war is motivated more by domestic politics than geopolitics. Although Washington has long cited China as a source of grievance in respect to US jobs and industries, the Trump 2.0 administration’s tariff offensive has been less about advancing direct US strategic goals in respect to Beijing than about permanently changing the Overton window of US industrial and trade policy. As such, the administration has acted in principle to enforce US tariffs across the board globally, with minimal strategic exemptions.

In doing so, Washington has established a pattern of trade negotiations whereby it uses the threat of ever-growing tariffs to push other countries into making unilateralist deals that strictly favor American preferences. The pattern of such deals involves the target country opening its market entirely to US products at zero tariffs in exchange for a softer US tariff, which in most cases is still no less than 19 to 20 percent, thus making these deals completely one-sided. For the export-orientated developing economies of Southeast Asia, such as Vietnam and Indonesia, these deals are devastating as a result.

While Washington ramps up these one-sided deals, China is the only country that has demonstrated the leverage and capability to hold its own against the US in trade negotiations. If the US escalates, China escalates proportionally and reciprocally, demonstrating its hold over critical supply chains, minerals and of course the sheer strength of its domestic market of 1.4 billion people. Thus, when Washington escalated tariffs, China slapped export controls on rare earths, which hammered US industries. This consideration has made Washington back away from the abyss and buckle down in negotiations.

The US’ trade war is motivated more by domestic politics than geopolitics. ... The Trump 2.0 administration’s tariff offensive has been less about advancing direct US strategic goals in respect to Beijing than about permanently changing the Overton window of US industrial and trade policy

As a result, if the US wants greater access to the Chinese market, Washington realizes that it will have to give more to China than to other countries. This is not going to be a “You give us tariff-free access and we keep a 20 percent tariff on you” scenario. Instead, Washington has to make serious concessions to Beijing, including, for example, removing more export controls on semiconductor chips and equipment. From the pattern that is emerging now, the Trump administration appears to be easing back on the Biden administration’s tech-war doctrine on Beijing, which involved ever-increasing export controls in a failed attempt to cripple China’s high-tech industries. Trump appears to realize that the US has to be “in it to win it” regarding the Chinese market.

Other requests could be to stop the unreasonable suppression of Chinese companies in the US market, or third-party markets, among other things. For example, this may include TikTok or DJI drones. Of course, we should acknowledge it as a reality that the US will not remove all tariffs, not least given the political stakes; but Trump is ultimately a deal maker. For example, part of the US’ deals with the European Union, Japan and South Korea have involved America gaining pledges for these countries to invest billions in US domestic manufacturing.

Would Trump, for example, tolerate Chinese companies investing in US-based manufacturing operations? Let’s say, DJI agrees to license its tech to a US representative and invest to have its products made locally, to avoid a ban? Or has the climate of US McCarthyism and hysteria against Chinese companies made this impossible? Still, it appears that if Trump so wishes it, there is potentially a stable way forward for US-China economic ties without ultimately throwing off his desire for greater protectionism. Talks will continue over the next three months. Trump appears very much aware that China has the leverage and ability to strike back, which is why things are being drawn out here, unlike with other countries where Trump just walks away and imposes higher tariffs. Here’s hoping that this can ultimately result in the most significant and mutually beneficial economic agreement the US and China have ever attained.

The author is a British political and international-relations analyst. 

The views do not necessarily reflect those of China Daily.