US–China Tariff Truce Sets New Global Standard – Nations Rethink Strategy as China’s Tough Stance Pays Off

The initial breakthrough in US–China trade negotiations has set a precedent, with China’s unwavering stance in the face of Trump’s so-called “reciprocal tariffs” policy serving as a model for other countries in their own tariff talks with the US. China had refused to yield throughout the process and maintained a “not backing down” posture. According to a May 18 Bloomberg analysis, China’s firm approach during tariff truce negotiations has convinced other countries that the Trump administration may have overestimated its own leverage, prompting them to reconsider their previous diplomatic strategies and swift concessions to the US. These countries are now contemplating adopting tougher tactics similar to China’s, though some experts caution that each nation must weigh its bargaining chips carefully.

Breakthrough in Geneva: 90-Day Tariff Truce

The US and China reached a tariff agreement in Geneva, with both sides agreeing to reduce tariffs within 90 days by 115-percentage-point. This reduction lays the groundwork for what is expected to be a lengthy and challenging negotiation between Washington and Beijing. Trump’s significant concessions surprised governments from South Korea to the European Union, many of which had previously complied with US requests without retaliating against its tariff measures.

“China’s tough posture in negotiations with the US has led some countries to believe they must also adopt a firmer stance in their own trade talks with the Trump administration.”

Bloomberg’s report notes: “After China’s tough negotiating tactics earned it a favorable — albeit temporary — deal, nations taking a more diplomatic and expedited approach are questioning whether that’s the right path.”.

Global Reactions: Rethinking Negotiation Tactics

Stephen Olson, former US trade negotiator and now Visiting Fellow at Singapore’s ISEAS–Yusof Ishak Institute, observed that many countries are closely watching the outcome of the Geneva talks. Olson believes the takeaway is that Trump is beginning to realize he may have overestimated his own leverage.

Although officials are reluctant to publicly acknowledge a shift in their approach, signs suggest that especially among major economies, there is growing awareness of the strength of their own negotiating cards. As a result, some are slowing down the pace of talks.

“The consensus from both delegations this weekend is neither side wants a decoupling… We do want trade. We want more balanced trade. And I think that both sides are committed to achieving that.” – US Treasury Secretary Scott Bessent

Last week, Trump stated that with half of the 90-day pause already elapsed, there is not enough time to reach agreements with around 150 countries, so the US may unilaterally raise tariff rates in the coming two to three weeks.

US Treasury Secretary Scott Bessent reiterated this warning on NBC’s “Meet the Press with Kristen Welker,” stating that if countries fail to negotiate trade agreements with the US in good faith, tariffs could snap back to the “reciprocal” rates imposed on “Liberation Day” last month.

India, Canada, and Japan: Cautious but Resolute

India is preparing to lower all tariffs on US goods, but Foreign Minister Subrahmanyam Jaishankar emphasized that negotiations are ongoing and “Until that is done, any judgment on it would be premature.” In the meantime, Commerce Minister Piyush Goyal was scheduled to travel to the US for further talks.

Marko Papic, Chief Strategist at Canada’s BCA Research, noted that many countries are likely to learn from China: the right way to negotiate with President Trump is to remain firm and composed, forcing him to back down.

Japanese trade officials are set to visit Washington this week. Japan’s Minister of Economy, Trade and Industry, Yoji Muto, skipped last week’s APEC trade ministers’ meeting attended by US Trade Representative Jamieson Greer. Japan’s chief negotiator, Ryosei Akazawa, recently expressed hope for a deal with the US in June, but local media now report that an agreement may be delayed until before Japan’s July upper house elections. According to the Financial Times, a Japanese official said that while Japan once hoped to be the first to negotiate tariffs with Washington, the urgency has faded; now the priority is securing a good deal.

Japan’s chief negotiator and Minister for Economic Revitalization, Ryosei Akazawa, stated earlier this month that he hoped to reach a deal with the US in June. However, recent local media reports suggest that the agreement may be postponed until July.

Alicia Garcia Herrero, Chief Economist for Asia-Pacific at Natixis, observed that many countries now waiting to negotiate are questioning the value of doing so. She pointed out that the agreement effectively allowed China to bypass others in the queue, and since there is no clear benefit for the US, this outcome is doubly frustrating for countries still waiting.

US Commerce Secretary Lutnick told Bloomberg TV that talks with Japan and South Korea will take time. Treasury Secretary Bessent, speaking at a Saudi–US investment forum in Riyadh, said the EU’s lack of unity is slowing negotiations.

Europe: Learning Not to Rush

Sources familiar with EU discussions revealed that the US-China tariff statement shows minimal progress for the US, and no clear final agreement was reached during the 90-day buffer period, indicating Trump’s willingness to keep up pressure on China is limited.

The Wall Street Journal reported that some EU officials believe the bloc is seeking a tariff reduction deal with the US that goes further than those with the UK or China. The lesson for Europe: don’t act hastily.

 Limits of the China Model: National Strength Matters

However, Singapore National University professor and former World Bank China director Bert Hofman cautioned that only countries with strong economies and limited dependence on US trade can afford to emulate China’s tough stance – otherwise, there are risks.

Take Canada, for example: Oxford Economics recently reported that Canada has effectively suspended nearly all tariffs on US goods. But Finance Minister François-Philippe Champagne countered that Canada still maintains 25% retaliatory tariffs on billions of dollars’ worth of US products, and a 70% counter-tariff imposed in March remains in effect, with only some tariffs temporarily lifted for public health reasons. Vietnam, on the other hand, relies on the US for a third of its trade, leaving it with little leverage and only able to project “verbal toughness.”

Moody’s Asia-Pacific economist Katrina Ell warned that if major economies decide to push back, services trade could become the next battleground, as data show the EU, Singapore, South Korea, and Japan all run significant services trade deficits with the US.

Deep Throat

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Brussels has evidently decided that targeting electric vehicles, steel, and chemicals just isn't enough. In a bizarre escalation, the EU is now dragging its trade war with China straight to the dinner table, turning Peking duck into the latest casualty.

The European Commission announced a full anti-dumping investigation into Chinese duck meat products, effective immediately, and left the door open to punitive tariffs. It also ordered mandatory customs registration for all Chinese duck meat entering the EU. This marks the first time in recent years that Brussels has extended trade barriers to a Chinese agricultural product. Analysts see it as possible payback for China's anti-dumping duties on European cognac imposed in May 2025, a sign that the EU-China trade dispute has now reached the dinner table.

According to the Commission's notice, China's duck production and cross-border sales benefit from policy intervention and multiple layers of subsidy. That support, Brussels argues, has driven a flood of cheap, oversupplied duck meat toward European markets. The influx has hit local farmers hard and undermined existing market mechanisms while eating into the EU's domestic industry. If the allegations hold up, the EU could impose tariffs on Chinese duck meat products.

The Commission's investigation into Chinese duck products could affect the raw materials behind China's signature Peking duck dish, with punitive tariffs not ruled out.

The Financial Times reported on July 10 that this is the EU's first extension of trade barriers into the Chinese agricultural sector in recent years. Previous EU protectionist measures against China focused mainly on industrial goods such as electric vehicles, steel and chemicals. The latest dispute is expected to further strain EU-China relations.

EU officials have repeatedly warned that the bloc's trade deficit with China is widening and now stands at roughly one billion euros a day, calling the trend unsustainable. Tensions between the two sides are already running high. Brussels has signaled that it will take further action if no progress is made on trade issues by October this year.

The European Commission says China rears the well known Pekin duck, the raw material for Peking duck dishes. Farmers benefit from subsidies tied to the national five year plan, low interest loans and cheap soybean feed. The Commission states the investigation stems from a complaint filed by five EU duck producers, who allege Chinese export prices for duck meat are below market levels and are damaging the EU industry. If the allegations are proven, the EU could impose tariffs on imported duck meat, whether fresh, frozen or smoked.

Pekin ducks have been raised in Europe and the United States for some 400 years.

Pekin duck sits at the center of this trade dispute, and it comes with centuries of history. The breed is known for its large size, fast growth and well distributed fat, traits that have made it a mainstay of modern duck meat farming. Pekin ducks were introduced to Europe and the United States some 400 years ago and remain one of the most important breeds in commercial duck farming today.

John Clarke, a former senior agricultural trade negotiator for the EU, finds the timing of the probe highly curious. He points out the absurdity of targeting such an iconic would likely provoke a strong response from both producers and authorities in Beijing.

Clarke also points to the odd timing given the EU's push to register Peking duck as a Geographical Indication (GI) product, which would tie the product's identity to its place of origin and bar non-Chinese producers from using the name. He warns that Beijing and Chinese companies may view the probe as retaliation for the earlier anti-dumping measures on cognac, another iconic European product, and could strike back. Producers of Italy's Prosecco, he adds, should be nervous.

Financial Times figures citing the UN Food and Agriculture Organization show China produces 4.8 million tonnes of the 5 million tonnes of duck meat made worldwide each year, about 96 percent of global output. The EU's duck meat market was worth 800 million euros in 2025, of which 199 million euros came from Chinese imports.

China accounts for 4.8 million of the 5 million tonnes of duck meat produced globally each year, about 96 percent of world output.

Chinese outlet Observer, however, notes that the EU is not actually a major market for Chinese poultry exports. In recent years, poultry exports from the Chinese Mainland have flowed mainly to Japan, South Korea, Hong Kong and Southeast Asia. The EU market only developed gradually after Brussels resumed imports of Chinese poultry in 2019.

This is not the first duck related trade dispute between China and the EU. In 2015, China requested consultations with the EU over its poultry tariff quota management measures and initiated World Trade Organization dispute settlement proceedings. In 2017, a WTO panel ruled that the EU's tariff quota allocation for duck products violated WTO rules.

To implement the ruling, China and the EU held multiple rounds of talks and signed an implementation agreement in November 2018. The deal set an annual country specific tariff quota of 6,600 tonnes for cooked duck meat from China, with a 10.9 percent tariff rate within the quota and a levy of 2,765 euros per tonne on volumes exceeding it. 

The agreement ended the previous arrangement under which Chinese duck meat competed for quota alongside other exporting countries, and it created more stable conditions for Chinese duck meat to enter the EU market.

On June 29, Chinese Commerce Minister Wang Wentao met with EU Trade Commissioner Maros Sefcovic. Both sides agreed to establish a trade and investment dialogue mechanism, aiming to resolve bilateral economic and trade differences. 

After the talks, Sefcovic said that if no progress is made on narrowing the trade imbalance by October this year, the EU will take further measures.

Friction between China and the EU has been building for years. Brussels has launched anti-subsidy and anti-dumping measures against Chinese products including electric vehicles, while Beijing has opened anti-dumping investigations into EU pork, dairy and French cognac. This latest probe shows the dispute is now spreading into agricultural products. 

Under EU procedure, the investigation is expected to run for about a year, and even if dumping is confirmed, the EU still needs support from a majority of member states before formally imposing anti-dumping measures.