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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Last Friday, Trump flat-out torpedoed a much-anticipated zero-emissions deal for the global shipping industry, smashing it apart at the United Nations' International Maritime Organization (IMO). The Financial Times lays it all bare: to kill the net-zero shipping pact, Trump didn’t just lean on the usual diplomatic muscle—Washington went full gangster. Think raised port fees, outright bans on ships passing through America, and direct threats, and even personal intimidation of diplomats and their families, with entry bans waved in their faces like warning flags.

The Financial Times lays it out: over a dozen diplomats, foreign officials, and industry insiders watched the US throw diplomacy in the mud at last month’s London summit. Washington came armed with bullying tactics, determined to smash the net-zero shipping pact by brute force.

US Bullying Blocks IMO’s Green Shipping Deal—Vote Delayed a Year. IMO website image.

US officials didn’t bother with backroom deals—they stalked the halls, cornering diplomats from Africa, the Pacific, and the Caribbean. The message was simple: cross the United States, and your ships might not reach America. Rock the boat, and your family could be locked out. These weren’t idle whispers. The intimidation played out in broad daylight during coffee breaks.

Social Media Taunts, Policy Upends

Trump didn’t bother hiding his true feelings. On social media, he slammed the agreement as a “global green shipping tax scam.” But this wasn’t just venting. In April, most countries had already green-lit the framework. It was set to become real policy—until Trump’s team blew it up, forcing a one-year “pause.” The global momentum froze on the spot.

One diplomat cut to the heart of it: “It’s like the streets of New York.” His country got the warning firsthand—keep backing the deal, and watch your sailors’ visas disappear. US port fees? Those would rise too. Another attendee was even more blunt: IMO bigwigs were left gobsmacked. “It’s like dealing with the mafia,” they said. “You don’t need details. You just know: cross us, and you’ll pay.”

The US State Department kept mum on the intimidation claims. Instead, American officials handed out praise to Greece and Cyprus. Those two broke rank from the rest of the EU—they cast abstention votes in the big one-year adjournment, even after they already gave the framework the green light back in April.

Secretary of State Marco Rubio, ahead of the IMO meeting in London, issued a joint statement with senior Trump officials warning that the administration was "evaluating sanctions on officials sponsoring activist-driven climate policies that would burden American consumers, among other measures under consideration." As Greece and Cyprus sided with the U.S., much of Europe—and the world—reacted with surprise.

Global Rules or American Muscle?

Chatham House’s head of global economy Creon Butler didn’t mince words. The US, he said, has ditched long-standing diplomatic etiquette. Instead, Washington's now muscling countries into backing its stance—especially on climate.

America Threatens: Support This, Your Crews and Ports Pay.

“In the very short term this might work, but in the medium term it increases the chances that non-US countries will conclude they cannot work with the US, making agreements independently among themselves which simply work around the US,” he said. Sooner or later, the rest of the world will ink deals that leave America in the dust.

The pushback reached fever pitch at the IMO. Brazil, among others, called out the methods “that should not ever be used among sovereign nations”. Washington wasn’t just rattling individuals—entire capitals, from Bangladesh to Japan and Indonesia, got notes threatening diplomatic smackdowns.

But let’s step back. The drive for a net-zero shipping pact isn’t about feel-good climate slogans.

As Niu Tanqin from Xinhua puts it: The pact itself is a brass-tacks response to global warming’s mounting cost. Whether you like it or not, global warming is simply an undisputable fact. Everyone is scrambling to stall off the climate catastrophes looming on the horizon.

So, in order to squeeze carbon emission: if your ship emits less than the set limit, you’re rewarded. Above the cut-off, you pay. China, the EU, Japan, India, Brazil—all were in. Even the big shipping companies joined the chorus.

Only a handful of oil states—think Saudi Arabia, Russia, the UAE—pushed back. Pacific island nations, unconvinced the pact was tough enough, simply abstained.

Trump Says Global Warming’s a Scam—US Walks Out.

Then, everything changed. Once Trump 2.0 manifested, the US flipped from supporter to saboteur. In his mind, climate change is a hoax—or worse, a Chinese plot to corner American interests. Stopping this agreement wasn’t just policy—it was personal. He didn’t mind stooping low—pulling out every trick in the high school bully’s playbook: pressure, threats, and outright intimidation to make sure America got its way.

One official wasn’t shy: “It was completely exceptional. I have never heard of anything like this in the context of an IMO negotiation. These people [being threatened] are just bureaucrats, they are civil servants.”

If international law becomes a mere cheap disguise, you can bet real power will be the one pulling the strings.

Pause Button Pressed—World Left Reeling

Now, the deal waits on ice for another year, while “the world stares, shell-shocked”—witnesses to a new era of American brinkmanship.

Not the first time, either. Just look at tariffs: if Washington’s unhappy, it writes its own tax bill—no debate required. Venezuela and Nigeria have both fielded threats of military action; Canada and Panama know the taste of territorial intimidation. Lawless? That’s par for the course.

  

But payback, as always, has a funny way of coming due. Today, the US bullies island nations and slaps down climate claims. Tomorrow, who’s next? When “might makes right” replaces rules, every nation that depends on order will lose out. True justice may come late—but it never skips its date. Chip away at the pillars of fairness, and sooner or later, you bury the very house you live in.

The real question: how long can America’s strong-arm show go on before the world walks out?