The recent US-China summit has made a quiet truth visible: Chinese leaders appear far more comfortable dealing with Donald Trump than with Joe Biden. Biden represented a more traditional American foreign policy grounded on values-driven alliances and institutionalized containment, all of which Beijing has long found to be systemic threats. By contrast, Trump’s deeply ingrained transactional approach aligns with a style of statecraft Beijing understands well.
This is not a new dynamic. Chinese leadership has a rich history of viewing negotiations as processes of trade-offs and calibrated bargaining. Veteran diplomat Qian Qichen once recalled that during the Gulf War in 1990, then-US Secretary of State James Baker approached diplomacy like business negotiations, always seeking a “deal.” Decades later, Beijing has deftly adapted to Trump’s brand of “deal-making” diplomacy. The recent Trump-Xi summit vividly showcased the transactional nature of contemporary US-China relations.
First and foremost, both sides sought the same overarching objective: stabilizing the relationship. At a time of rising tensions over trade, technology and Taiwan, simply maintaining engagement and preventing the relationship from spiralling further downward became the summit’s most important achievement.
Trump was received with the symbolic gestures, personal attention and political spectacle he craves in diplomacy: a lavish reception featuring military bands, cheering children and youth, red carpets and high-level hospitality, including a meeting with Xi in the Zhongnanhai leadership compound, all of which was designed to appeal to the American president. China, meanwhile, secured something it has pursued for years: a reframing of bilateral relations around a broader strategic framework emphasizing “constructive China-U.S. relations of strategic stability.”
Historically, Beijing has obsessed over establishing a grand strategic framework, while Washington usually dismisses these political formulas as empty rhetoric. For example, the “new type of major power relations” during the Obama era were heavily promoted by China but largely ignored by the United States, which preferred focusing on concrete issues such as trade and technology. Trump and his team appeared similarly uninterested in publicly endorsing Beijing’s new framework but, notably, this time they chose not to reject but to complement it — leaving China to celebrate its symbolic victory without committing the United States to any substantive obligations, as long as it they conduct their relationship “on the basis of fairness and reciprocity.”
Trade and tariffs remained the summit’s central practical issue. Both governments recognize that neither side benefits from an uncontrolled economic rupture, and modest agreements can serve as critical guardrails to sustain a vital trade truce. The concrete outcome was the establishment of a bilateral board of trade and a board of investment. These institutional mechanisms are designed to manage disputes, facilitate reciprocal tariff reductions on non-sensitive goods and encourage limited Chinese investment in non-strategic sectors of the US economy.
Both sides signalled optimism about trade understandings. The fact sheet posted on the White House website following their visit revealed immediate, transactional victories that feed into Trump’s “America First” agenda. China committed to major purchases of US soybeans, oil, beef and 200 American-made Boeing aircraft — all politically valuable for a president focused on jobs and domestic economic messaging. China’s official statements similarly described the talks as producing “balanced and positive outcomes,” which could secure the breathing room Beijing needs to insulate its broader supply chains.
The summit also exposed the transactional undercurrents shaping core geopolitical flashpoints, notably the Taiwan question.
Tensions Over Taiwan
For Beijing, Taiwan remains the core issue in China-US relations. Ahead of the meetings, media explored a subtle linkage between Chinese cooperation on Iran and US concessions on Taiwan, as well as China’s intention to directly challenge the historical US policy of refusing to consult Beijing on cross-strait arms sales.
From China’s perspective, the summit yielded some gains by capitalizing on Trump’s skepticism toward distant foreign conflicts and his transactional view of security guarantees. Trump’s post-summit commentary revealed that he rejected the Reagan-era pledge of not consulting Beijing on Taiwan’s defence purchases by discussing the details of upcoming arms sales with President Xi. By hinting that the United States would not back partners unconditionally and downplaying the risk of conflict over an island “9,500 miles away,” Trump gave Beijing the rhetorical leverage it sought to deter Taiwanese independence.
This aligns with Beijing’s assessment that Trump views Taiwan less as a strategic commitment and more as a negotiable bargaining chip.
At the same time, Trump’s ambiguity also reflects his own transactional instincts. Arms sales, security assurances and strategic ambiguity all become leverage points in negotiations with both Beijing and Taipei. This unpredictability worries Taiwan and regional allies such as Japan, who fear that Trump could redefine long-standing American commitments through sudden political bargaining. Japanese Prime Minister Sanae Takaichi spoke with Trump immediately after the summit for security reassurance.
On Iran, however, the summit demonstrated that transactional diplomacy can also produce limited cooperation. Both countries reportedly agreed on the importance of keeping the Strait of Hormuz open and preventing Iran from obtaining nuclear weapons. China has strong economic interests in regional stability, given its dependence on Middle Eastern energy imports. Although Beijing remains cautious about appearing part of a formal US-China “G2” duo governing world affairs, de-escalating the crisis through a US-China consensus serves its own economic stability while positioning it as a responsible global broker.
The same logic applies to technology and artificial intelligence (AI). Even the fiercely contested tech sector saw targeted, transactional compromises. The two sides agreed to establish guardrail mechanisms to prevent powerful, frontier AI models from falling into the hands of non-state actors. Furthermore, Washington permitted a limited breakthrough by allowing Nvidia to sell its H200 chips to 10 select Chinese tech firms. These tightly managed exemptions demonstrate that even in an era of technological decoupling, specific commercial assets can still be traded to preserve a broader geopolitical détente.
For middle powers such as Canada and countries caught between Washington and Beijing, this summit offers a temporary sigh of relief and reduces uncertainty for global markets. The establishment of the US-China Board of Trade and the maintenance of a trade truce prevent an immediate global economic rupture, at the same time as they justify the strategy of leaders looking to diversify trade and regional cooperation amid superpower friction.
That said, the inherent danger of transactional diplomacy is its radical unpredictability. Trump notoriously leverages volatility as a negotiating tool, and is capable of reversing course or abandoning agreements on a whim — much as he did following his 2017 visit to Beijing, which was swiftly followed by the initiation of a trade war. China offers a different kind of predictability: when Beijing breaks a consensus, it invariably deploys a highly choreographed political narrative blaming its rival’s provocations.
For now, both countries appear interested in maintaining a relatively stable relationship and to believe that continued bargaining is preferable to uncontrolled confrontation. With both leaders scheduled to meet again at the White House in September, followed by possible meetings at the APEC Economic Leaders’ Meeting in Shenzhen in November and the G20 Leaders’ Summit in Miami in December, the diplomatic calendar alone suggests the relationship has guardrails for the remainder of 2026. While Biden tried to build that stability through institutions and values, Trump has built it through deals. The open question is whether a relationship built on transactions rather than trust can hold when one side decides the deal is no longer worth making.
