Containers piled up at Taicang Port container terminal in Suzhou City, Jiangsu Province, China on May 18, 2025.
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The report comes from this week's CNBC China Connect Newsletter, which provides you with insights and analysis on promoting the world's second largest economy. Every week, we explore China’s biggest business story, reduce the shift to the market and help you set it up in the coming week. Like what you saw? You can subscribe here.
In the week after the U.S.-China trade tensions broke through, both sides could be assured that the other side insisted on the end of the bargaining.
"These 90 days will not be stable," Liu Weidong, a researcher at a national think tank at the American Institute of the Chinese Academy of Social Sciences, told me this week. This is based on the translation of his Mandarin remarks by CNBC.
Given the already big breakthrough, he expects the uncertainty and smaller steps to rise next as the United States and China each try to get each other towards a middle-level position.
The posture has begun.
China's Ministry of Commerce warned on Wednesday that it would take legal action against users who participate in or take steps to curb China's advanced semiconductors.
It was the same department’s allegation on Monday that blamed the U.S. for undermining trade talks with Huawei chip warnings last week — although the U.S. Industry and Security Agency has actually lowered its language and rejected a more restrictive Biden-era plan.
Many in the United States also worry that China has not relaxed controls on rare earth exports, another area where China dominated the supply chain. Despite a vague description of how China will suspend or delete non-tariff countermeasures to the United States since April 2, 2025. ”
“I do think Washington is looking to reduce export control of this rare planet to export relatively unrestricted,” said Scott Kennedy, senior consultant and trustee and trustee president of the Center for Strategic and International Studies in Washington, Washington.
"If it turns out, this is not the result, the United States may conclude that China has violated the agreement," he said. "We can see a re-escalation soon."
Although the White House has not responded to CNBC's request for comment, the retreat reveals ambiguity on China.
But is rare earth export control part of China's tariffs on the United States? This is a debate. On April 4, the Ministry of Commerce and the Customs Administration announced that export control documents did not clearly mark them.
Although China imposed restrictions on 28 U.S. entities that control exports to critical minerals, the ministry made several public statements on strengthening export controls to critical minerals.
“Given the comprehensive and competitive nature of bilateral relations, the current truce, while concentrated on trade, is easily weakened by export control,” said Yue Su Su Su Su Su Prachist Economist, China, the intelligence department of economist.
"While rhetorical posture is unlikely to undermine a 90-day truce, China is likely to recalibrate its export control regime in response to U.S. actions," she said.
China's Ministry of Commerce also announced on Sunday that it has a responsibilities for importing engineering plastics from the United States, Europe, Japan and Taiwan.
U.S. President Donald Trump told Fox News last week that he was open to Chinese President Xi Jinping and even Chinese travel. But Beijing did not give up any prompts.
"I would be surprised if it wasn't clear about the two steps of these two issues at this time," Kennedy said.
The new U.S. ambassador to China, David Perdue, arrived in Beijing on Thursday, more than two weeks after being confirmed by the Senate. He used to be the head of Asia at Sara Lee, a consumer packaging company in the United States.
One of Perdue's first social media posts calls for "strong action" against fentanyl. He said on X that along with U.S. Trade Representative Jamieson Greer, they “meaningly engaged to the Chinese to stop this dangerous situation.”
The U.S. has left 20% tariffs on tariffs imposed earlier this year on China’s role in the fentanyl crisis.
Last week's joint statement said the United States and China will establish a negotiation mechanism on economic and trade relations, but neither side specified when the next one will happen.
Liu wrote a report in February in a report on bilateral cooperation at the Carter Center, where he stressed that the overall focus of the current negotiations is trade rather than technology. He hopes China can eventually agree to buy more American agricultural and energy products — given that people think that forcing farmers will affect Trump.
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Shanghai's comprehensive performance last year.
Stocks in China and Hong Kong rose on Wednesday.
The CSI 300 in mainland China rose 0.68%, while Hong Kong's Hang Seng index (including major Chinese companies) rose 0.53% as of 12 p.m. local time.
The benchmark 10-year yield on Chinese government bonds was 1.669%.
May 22: Xiaomi releases mobile phone chips, its first SUV and other products
May 27: China reports industrial profits in April