- Presidents Xi and Trump hold first phone call in months as trade tensions flare.
- China maintains it has upheld the Geneva agreement, despite U.S. accusations of violations.
- Market uncertainty persists as both economies grapple with supply chain disruptions.
A Tense Exchange Between Leaders
Chinese President Xi Jinping assured U.S. President Donald Trump in a phone call that Beijing has adhered to the terms of the recent Geneva agreement, state broadcaster CCTV reported. The conversation, their first in months, comes as Washington accused China of "totally violating" the deal, which temporarily suspended certain tariffs for 90 days to ease trade hostilities.
Trump had hailed the Geneva pact as a "total reset" just weeks ago, but tensions resurfaced after the U.S. alleged non-compliance. China, meanwhile, has criticized recent U.S. policy moves, further straining relations. The agreement had required the U.S. to suspend 24 percentage points of added tariffs on Chinese goods while maintaining a 10% rate during the cooling-off period.
Economic Stakes Remain High
Both economies face mounting pressure—U.S. manufacturers reliant on Chinese inputs, particularly critical minerals for electronics and defense, are grappling with supply uncertainties. Meanwhile, Chinese exporters and workers in tariff-hit sectors confront instability. Global markets remain jittery as the standoff threatens to derail fragile supply chains.
While the call signals an attempt to de-escalate, skepticism lingers given past short-lived truces. Periodic reviews of tariff suspensions are planned, with both sides reserving the right to reimpose duties if compliance falters. Without durable enforcement mechanisms, analysts warn the détente remains precarious.