Trump, Xi Meet in Beijing on Trade War Fallout

Presidents Donald Trump and Xi Jinping met in Beijing this week to address the fallout from a decade-long trade war that has sharply reduced commerce between the world's two largest economies.

The summit follows a particularly intense 2025, when tariffs and retaliatory measures inflicted significant damage on businesses and farmers in both countries. U.S. tariffs on Chinese imports, which averaged 3.1 percent before 2018, now stand at nearly 48 percent after peaking at triple-digit levels last year, according to Chad Bown of the Peterson Institute for International Economics. Bilateral trade, which accounted for more than 13 percent of total U.S. trade in 2016, fell to 6.4 percent last year, with Mexico and Canada surpassing China as the top U.S. trading partners. The U.S. goods and services trade deficit with China, which reached $377 billion in 2018, declined to $168 billion last year, the lowest since 2004.

Companies have adapted by diversifying supply chains. Many U.S. firms, including Apple and Nike, shifted production to Vietnam and India, while Chinese manufacturers rerouted exports through Southeast Asia to evade tariffs. U.S. imports from Vietnam rose 42 percent, from...