US President Donald Trump on Monday said that Washington and Beijing — the world’s two largest economies — are headed for a “great relationship,” but warned that he could “destroy China” if he decided to use the “incredible cards” available to him.
Speaking in the Oval Office before his bilateral meeting with South Korean President Lee Jae Myung, Trump stressed that the US holds a stronger hand than China in the ongoing trade dispute.
“We are going to have a great relationship with China… They have some cards. We have incredible cards, but I don’t want to play those cards. If I play those cards, that would destroy China. I am not going to play those cards,” Trump told reporters, without clarifying what those “cards” were — whether economic, political, or strategic — according to Fox News.
Trump singled out Beijing’s rare earths policy, cautioning that unless China continued supplying the US with magnets, “we have to charge them 200% tariff or something,” Reuters reported.
Trade Talks Still in Play
The US President also revealed that he had recently spoken with Chinese President Xi Jinping and was considering a visit to China. “At some point, probably during this year or shortly thereafter, we’ll go to China,” he said. Xi had extended an invitation to Trump last month.
Both sides extended their trade truce for another 90 days on August 12 to allow more time for negotiations. Over the past year, Trump ramped up tariffs on all Chinese goods — peaking at 145% in April — before lowering them to the current 30% on most imports. In retaliation, China tightened restrictions on rare earth exports and maintained a 10% tariff on US products.
Oil and Manufacturing Disputes
Adding to the friction, US Treasury Secretary Scott Bessent flagged China’s oil imports from sanctioned nations, including Iran and Russia, as a sticking point in talks held in Sweden. Bessent also stressed Washington’s broader aim of reducing China’s dominance as the “world’s factory” and pushing Beijing to expand its role as a global importer rather than just an exporter.
