China has fiercely condemned the United States on Monday, 2nd June 2025, for a series of recent moves that it says undermine the fragile trade truce between the world’s two largest economies. Beijing’s criticism comes in response to new US export restrictions on artificial intelligence (AI) chips, a ban on the sale of chip design software, and plans to revoke student visas for Chinese nationals.

In a strongly worded statement, China’s Ministry of Commerce said, “These practices seriously violate the consensus” reached in a recent trade discussion held in Geneva last month. The statement referred to a joint declaration where both countries had agreed to substantially roll back tariffs and resume stalled trade talks.

However, despite the 90-day pause in hostilities, this latest statement from China has highlighted the continued tension that simmers beneath the surface of the fragile agreement.

What Happened in Geneva

The Geneva accord, announced in May 2025, was seen as a breakthrough in de-escalating President Donald Trump’s escalating tariff war with China. Under the deal:

• The US agreed to lower its punitive tariff from 145% to 30%

• China reciprocated, cutting its tariff on US imports from 125% to 10%

These reductions were expected to create a window of opportunity for the two sides to work towards a more durable and long-term trade arrangement. However, no structural agreement was finalised, leaving both markets in a state of heightened uncertainty.

China’s Accusations and Reaction

According to China’s Commerce Ministry, Beijing has upheld its end of the agreement, including cancelling or suspending retaliatory measures against the US. In contrast, the US has “unilaterally provoked new economic and trade frictions”, undermining the spirit of cooperation.

The statement said,

“The United States has unilaterally provoked new economic and trade frictions, exacerbating the uncertainty and instability of bilateral economic and trade relations.”

Beijing has warned of “resolute and forceful measures” in response to the US actions, hinting at a potential new wave of retaliatory steps, though it did not specify what these would entail.

Trump’s Provocative Comments

On Friday, 30th May 2025, President Donald Trump intensified the confrontation, stating via social media:

“The bad news is that China, perhaps not surprisingly to some, HAS TOTALLY VIOLATED ITS AGREEMENT WITH U.S. So much for being Mr. NICE GUY!”

Just hours later, from the Oval Office, Trump appeared to soften his stance slightly, expressing willingness to speak with President Xi Jinping to resolve the matter.

However, his administration’s actions suggest a hardening approach—especially in terms of national security concerns related to AI and semiconductors, two industries at the core of the ongoing US-China tech rivalry.

AI Chips, Software Bans and Student Visas

One of the most contentious new US measures is a fresh round of restrictions on AI chip exports to China. This includes a ban on the sale of chip design software critical to China’s ambitions in developing next-generation processors.

Adding to the rising tension is the announcement that the US will begin revoking visas for Chinese students studying in the US. With more than 2,75,000 Chinese students enrolled in American universities, this move could have a wide-ranging impact on educational and cultural ties, further complicating the bilateral relationship.

The Larger Geopolitical Backdrop

Beyond trade, both the US and China are engaged in a broader geopolitical and technological rivalry:

• The US seeks to maintain dominance in AI, semiconductors, and strategic technologies.

• China aims to challenge US supremacy, especially in the Asia-Pacific region, with ambitions to exert greater influence, including over Taiwan.

Washington views China’s tech ambitions, including those involving AI military applications and cyber infrastructure, as national security threats. This has led to increased scrutiny of Chinese entities, along with export restrictions and investment screening.

Future Uncertain Despite Temporary Truce

While the Geneva agreement was initially welcomed by businesses and investors, many have remained cautious, seeing it only as a temporary ceasefire.

There are widespread concerns that the truce may not hold, especially with both sides now accusing the other of breaking the agreement.

• China maintains it has honoured its obligations, even while criticising the US for new provocations.

• Trump’s administration claims China has violated the deal, demanding stricter enforcement and further concessions.

The 90-day window created by the Geneva deal was intended to de-escalate tensions, but as the current standoff shows, long-standing structural issues remain unresolved.

What Lies Ahead

The immediate future of US-China relations remains uncertain. Key areas of contention include:

• Advanced technology access

• Export controls

• Tariff implementation

• Student exchanges and academic cooperation

With both sides issuing stern statements, the chances of reaching a permanent trade and tech settlement look slim—especially in an election year for the US, where hardline policies against China may have domestic political appeal.

China’s final warning on Monday summed up the mood:

“China will continue to take resolute and forceful measures to safeguard its legitimate rights and interests.”

Whether this leads to fresh retaliation or another round of negotiations will shape the global economic and strategic landscape in the months to come.

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