Trump goes to Beijing as Xi holds all the cards

When US President Richard Nixon landed in Beijing on 21 February 1972, he carried with him the full weight of American supremacy. Nixon's handshake with Mao Zedong, which shocked the world, was an act of supreme strategic confidence.

America was not approaching a pariah state dangling recognition as a calculated weapon against the Soviet Union. Washington held every card, and Beijing knew it. The meeting restructured the global order on American terms.

Fifty-four years later, US President Donald Trump touches down in the same city. The contrast could not be more stark.

Where Nixon arrived as the uncontested leader of the free world offering a prize, Trump arrives nursing a 62% disapproval rating, trapped in a Middle Eastern quagmire of his own making, his economic weapons either blunted by his own Supreme Court or surrendered in humiliating ceasefire negotiations. And Beijing knows it all too well.

The Iran debacle

On 28 February 2026, the United States and Israel launched Operation Epic Fury against Iran. Donald Trump ignored explicit warnings from the Joint Chiefs that it could prompt Iran to close the Strait of Hormuz. Iran did exactly that.

From 4 March, Iranian forces declared the Strait shut and attacked vessels attempting transit, triggering what the International Energy Agency called the 'largest supply disruption in the history of the global oil market'. Brent crude surpassed $100 per barrel within days, peaking at $126 — the steepest single-month oil price rise ever recorded.

The economic fallout was immediate and global. Asian LNG spot prices more than doubled overnight to $25.40 per million BTU as QatarEnergy declared force majeure at Ras Laffan, the world's largest LNG facility. Fertiliser, aluminium, and helium supplies were simultaneously disrupted.

Federal Reserve modelling projected the closure would raise WTI oil to $98 per barrel and shave 2.9 annualised percentage points off global GDP growth in a single quarter. American motorists saw pump prices rise by $1.16 per gallon within weeks. Trump, who told his advisers Iran would 'capitulate', instead handed Beijing its most potent piece of leverage — Washington's desperate need for Chinese mediation to end a war of its own making, as Iran grew closer to China over the course of the war.

The tariff war that backfired

If the Iran war destroyed Trump's strategic leverage, the trade war destroyed his economic leverage.

In early 2025, Trump imposed 'Liberation Day' tariffs reaching 145% on Chinese goods — an escalation designed to force Beijing into structural concessions. China's response was to reach for rare earth materials, of which it controls approximately 90% of global processing capacity.

Trump's visit will round out a dozen or so leaders who have travelled to Beijing in just the first five months of 2026 as China's clout grows. Xi has hosted the leaders of Tajikistan, the United Kingdom, South Korea, and Iran's foreign minister in recent weeks alone. Russian President Vladimir Putin is expected to visit Beijing the week after Trump departs.

When Beijing restricted exports in October 2025, the effect on US defence and manufacturing supply chains was rapid and acute. The Trump administration agreed to a trade ceasefire that month, lowering tariffs from 57% to 47%.

Then, in February 2026, the US Supreme Court ruled against Trump's use of the International Emergency Economic Powers Act (IEEPA) to impose unilateral tariffs, the legal mechanism underpinning his entire coercive trade architecture. At a stroke, his primary legislative weapon was disarmed just as Trump prepared to negotiate in Beijing.

The technology gap that once gave Washington genuine bargaining power has also narrowed to near-irrelevance. China's AI models are estimated to be roughly six months behind their American equivalents — effectively peer status in a domain that moves in quarterly cycles. 

Given how aggressively China has infiltrated US infrastructure, the development of cutting-edge AI models with a talent for spotting and exploiting cyber vulnerabilities offers a preview of a future in which the US-China clash in cyberspace becomes far less forgiving.

The Taiwan question

In Taiwan, the stakes are highest and the Trump administration most exposed. Xi Jinping will once again emphasise Chinese concerns over Taiwan and seek explicit US agreement to restrict arms sales as a quid pro quo for a more stable relationship — or push for a change in long-standing US language that Beijing can portray as a diplomatic victory.

Taipei is particularly worried that Beijing will successfully persuade Trump to express 'support' for peaceful unification or state that the United States 'opposes', rather than 'does not support', Taiwanese independence. Taiwan is also concerned that Trump will negotiate with Xi over arms sales, thereby undermining one of President Ronald Reagan's Six Assurances.

These fears are not paranoid. Trump has already stalled an $11 billion arms package to Taipei. He denied Taiwanese President Lai Ching-te's transit through the United States. He has publicly stated that a Chinese invasion is 'up to' Xi.

Xi could also attempt to use the recent visit of Chinese Nationalist Party Chair Cheng Li-wun — who favours closer ties with China — to portray President Lai as someone who does not represent mainstream Taiwanese public opinion, framing him as a reckless leader whom Beijing and Washington should jointly restrain. A senior Taiwanese official, speaking to Bloomberg ahead of the summit, said: "What we are most afraid of is Taiwan being put on the menu in talks between Xi Jinping and President Trump."

China's position

Trump's visit will round out a dozen or so leaders who have travelled to Beijing in just the first five months of 2026 as China's clout grows. Xi has hosted the leaders of Tajikistan, the United Kingdom, South Korea, and Iran's foreign minister in recent weeks alone. Russian President Vladimir Putin is expected to visit Beijing the week after Trump departs.

Within Chinese official circles, the acronym TACO has taken hold — 'Trump Always Chickens Out'. It is based on a pattern observed across Trump's two terms: when coercive pressure threatens the US stock market, Trump retreats. This assessment has transformed Chinese negotiating behaviour, encouraging Beijing to prolong negotiations long enough for the political and economic costs to mount for Trump.

Experts have expressed concern that Trump may be travelling to a resurgent rival seeking help to escape a war he started, having exhausted his economic tools and watched America's technological advantages narrow. Xi, meanwhile, is likely to project calm confidence, reinforcing a message of stability and continuity. And that may prove to be the setback Trump never expected.