Welcome to Foreign Policy’s China Brief.
The highlights this week: The Trump administration continues its overtures to China with Nvidia export deal, an online crackdown intensifies in Hong Kong after a deadly fire, and China reaches a record trade surplus.
Welcome to Foreign Policy’s China Brief.
The highlights this week: The Trump administration continues its overtures to China with Nvidia export deal, an online crackdown intensifies in Hong Kong after a deadly fire, and China reaches a record trade surplus.
Sign up to receive China Brief in your inbox every Tuesday.
Sign up to receive China Brief in your inbox every Tuesday.
Sign Up
By submitting your email, you agree to the Privacy Policy and Terms of Use and to receive email correspondence from us. You may opt out at any time.
Enter your email
Sign Up
Loading…
Trump Is Changing Tack on China
U.S. President Donald Trump announced on Monday that he will permit semiconductor giant Nvidia to export its high-end H200 chips to China, potentially handing Beijing a boost in the battle for artificial intelligence supremacy. In characteristic fashion, Trump is insisting on the U.S. government taking a 25 percent cut of the sales.
The H200 isn’t Nvidia’s most advanced chip, but it outclasses the cut-down models that Nvidia had designed especially for the Chinese market. The deal is undoubtedly a product of Nvidia CEO Jensen Huang’s lobbying in Washington, but it also appears designed to curry favor with Chinese President Xi Jinping, with whom Trump hopes to secure a significant trade agreement.
The move comes amid a flurry of conciliatory behavior toward China. Stephen Miller, the White House deputy chief of staff for policy, is reportedly tasked with blocking any U.S. government action that could jeopardize a potential trade deal with Beijing. Vice President J.D. Vance has been echoing Chinese rhetoric, and the administration effectively killed legislation that would have required U.S. firms to offer the government first-purchase rights on key chips.
China, however, is not returning Trump’s affection. Despite a modest de-escalation in tariff and port fee disputes, the October handshake deal between Xi and Trump has amounted to little in practice. For instance, China has purchased a mere 20 percent of the soybeans that it promised to buy from the United States this year, leaving U.S. farmers in the lurch.
Taken together, the events of the last week have dealt a blow to the remaining China hawks in the Trump administration. To be sure, Trump could reverse course at any moment. But the hawks’ predicament runs deeper, as underscored by the new U.S. National Security Strategy released last week.
The strategy document makes only a few perfunctory mentions of China, largely in praise of Trump’s tariffs. Unlike strategies under both former U.S. President Joe Biden and Trump, there is no discussion of China being the primary foreign-policy challenge for the United States.
The National Security Strategy also suggests that Trump’s team has abandoned meaningful commitment to human rights—a departure from his first term, when officials called for action on Chinese atrocities in Xinjiang and elsewhere, albeit selectively. In fact, the worldview outlined in the strategy accords to some degree with China’s, asserting that great powers can act freely within their spheres of influence and are not bound by international norms.
It was unlikely that the second Trump administration would maintain the same treatment of China as the first. Still, some hawks chose to ignore Trump’s politics, temperament, and personnel choices in the naive hope that he would empower them to pursue a more confrontational China policy.
That said, the Trump administration will have a hard time fully reversing course. Washington’s bureaucracy has for years organized around the premise that China is the United States’ primary strategic competitor; staff at key departments are likely to keep operating under that assumption. So is Congress, where opposition to China is a rare point of bipartisan connection.
Trump may eventually secure a flashy deal with Xi, but given Washington’s broader orientation, such a deal is unlikely to stick—no matter how much the U.S. president is willing to give away to reach it.
What We’re Following
Thai-Cambodia conflict. On Monday, Thailand launched airstrikes on Cambodia, escalating a new round of fighting along their disputed border and upending a tenuous cease-fire deal signed less than two months ago. China, which helped broker the earlier July truce alongside the United States, is likely to play a key role in de-escalating the conflict.
China is Cambodia’s most important ally, but it also maintains close links with Thailand. Beijing’s most immediate concern, however, may be the fate of the scam centers along the tense border. These lucrative operations, run by criminal networks with ties to elements of the Chinese military, often target Chinese citizens and account for a significant portion of Cambodia’s GDP.
Hong Kong crackdown. Hong Kongers sharing critical information online about the apartment fire that killed at least 159 people last month have begun halting their work due to government fears of hostile “foreign forces,” or, more euphemistically, “for obvious reasons.” Such phrasing is a signal that someone has been threatened by the police—an all-too-familiar experience in mainland China and another marker of Hong Kong’s shrinking freedoms.
Meanwhile, public attention on the mainland has instead centered on a train crash in the city of Kunming that occurred around the same time as the Hong Kong fire, killing 11 people. A terse statement from railway officials drew particular criticism online, with many people seeing it as emblematic of a government that is indifferent to public safety.
FP’s Most Read This Week
Tech and Business
Trade surplus soars. Despite Trump’s tariffs, China’s trade surplus reached a record $1 trillion this year, as Chinese firms redirected exports to new markets and expanded aggressively across the developing world, often at the expense of local jobs.
The irony is that this surge is not a great sign for the Chinese economy. Overproduction, deflation, and intense price wars are squeezing Chinese manufacturers and destabilizing key industries. An artificially weakened yuan fuels China’s export dominance but also weighs heavily on Chinese consumers.
VPN restrictions. The most common way to evade China’s Great Firewall is to use a virtual private network (VPN), which routes a user’s connection through a server outside the country. Setting one up in China was once relatively easy, but the government’s escalating crackdown on the practice means that users now must leave the country to install VPN software.
Continuous upgrades to the Great Firewall—or, as one excellent recent report calls it, the Locknet—frequently disable individual VPNs until their providers can update them.
VPNs are illegal for ordinary Chinese, although government agencies and state-owned enterprises often use them. In heavily policed regions such as Xinjiang and Tibet, police have occasionally stopped pedestrians to inspect their phones for VPN apps.
A recent propaganda campaign signals that this latest round of restrictions may be more extensive, warning that foreign intelligence services use VPNs to spy on Chinese citizens and that accessing foreign websites could lead Chinese to betray their country.
