US-China Trade War: Narrative Battle Intensifies

The ongoing trade dispute between China and the United States continues to escalate, with each nation accusing the other of provoking insta...

The ongoing trade dispute between China and the United States continues to escalate, with each nation accusing the other of provoking instability in the global economy. Analysts suggest that this war of words is a calculated strategy by both sides to apply maximum pressure in hopes of securing a favorable deal.

Recent exchanges have seen Washington characterize the situation as "China versus the world." US Treasury Secretary Scott Bessent, for example, recently suggested that China's restrictions on rare earth element exports, unveiled the previous week, demonstrated that the nation is an "unreliable partner."

Beijing has retaliated by accusing the US of employing a "double standard." Chinese officials have cited the expansion of companies subject to Washington's trade restrictions and the extensive US export control list, comprising over 3,000 items, compared to China's list of approximately 900.

The Communist Party's official newspaper, the People's Daily, has defended China's rare earth regulations, asserting that they aim to better safeguard world peace. According to the publication, a "comprehensive assessment" indicates that the measures will have a minimal impact on supply chains.

At a press conference, Commerce Ministry spokeswoman He Yongqian refuted the US claims, stating that they "severely distort and exaggerate China's measures, deliberately causing unnecessary misunderstanding and panic."

Competing Narratives

John Gong, an economics professor at the University of International Business and Economics in Beijing, views the back-and-forth as a battle of competing narratives. While Washington frames the issue as "China versus the world," Beijing's perspective is that it is a case of "China against the war."

Gong explained that China's position on rare earths is to prevent illegitimate military applications. He added that China's approach to rare earth controls mirrors American controls on semiconductor exports.

Xu Mingqi, a researcher at the Shanghai Academy of Social Sciences' Institute of World Economy, believes that Washington's strategy involves rallying allies by claiming the moral high ground. However, the success of this approach hinges on other countries' actual economic experiences with both China and the US. Ultimately, both sides are positioning themselves for pre-negotiation leverage, though Xu believes a deal will eventually be reached.

G7 Discussions and International Reactions

The issue of China's rare earth controls was recently discussed by financial leaders from the Group of Seven (G7) nations, the world's major advanced economies, at a meeting in Washington.

Nick Marro, principal economist for Asia at the Economist Intelligence Unit, questions how well the US message will resonate with its allies, given the Trump administration's history of undermining relations with many trade partners.

Marro observed that the Trump administration seems to be adopting tactics previously used. He also noted that recent developments suggest Beijing is frustrated with the US strategy of engaging while simultaneously being antagonistic.

Openness to Negotiation

He Yongqian, the commerce ministry spokeswoman, stated that China remains open to equal negotiation based on mutual respect.

Upcoming Summit and Potential Outcomes

Beijing and Washington are engaging in strategic maneuvering ahead of a potential meeting between Presidents Trump and Xi Jinping at the Asia-Pacific Economic Cooperation forum.

Wang Dan, China director at Eurasia Group, suggests that both countries are seeking to exert "mutual maximum pressure" in the lead-up to the summit, viewing this as a negotiation tactic. China’s core objective is to reach the negotiating table. Given the current sentiment, China needs to project strength.

"I believe both sides will eventually reach the negotiating table on equal footing, engaging in talks while continuing to exert pressure," Wang said.

Potential goals for each side include:

• China: A significant reduction of remaining US tariffs.
• US: An easing of China's controls on rare earth exports or expedited approval of licenses for shipments of those items.
• Sustaining the tentative TikTok ownership deal is another goal for the US, as Trump cannot afford to lose young voters ahead of the midterm elections in 2026, Wang added.

The proposed agreement would place the social media platform's US operations under American ownership, with Chinese operator and current owner ByteDance retaining a stake of less than 20 per cent.

Framing and Global Tariffs

Song Guoyou, deputy head of the Institute of International Studies at Fudan University in Shanghai, argues that America's "China against the world" framing overlooks the fact that its tariffs also target the entire world.

"The 'narrative war' is essentially defining who is the unreasonable party, but at its core, Trump's global tariffs are the starting point of all this chaos," he said.