The flurry of punitive measures taken against China by the Trump administration over the last few days was prompted by a belief among US officials that China has failed to live up to commitments it made in trade talks earlier this month, three administration officials told CNN.
This week the administration made moves to revoke visas for Chinese students and suspend the sale of some critical technology to Chinese companies.
The officials said they are frustrated that China failed to follow through on the commitments that were meant to deescalate the trade conflict between the two countries, as they seek an overall deal by the middle of August.
The dispute underscores the highly fraught relationship between the world’s two largest economies. Even as the two sides emerged from the talks in Switzerland having agreed to reduce the withering tariffs introduced by President Donald Trump, the gulf appears to be widening on supply chains that each nation believes are critical to national security.
After the talks in Geneva this month — the first substantive meeting on trade since Trump imposed the tariffs — US officials had expected China to ease export restrictions of rare earth minerals, which are an essential part of everything from iPhones and electric vehicles to big-ticket weapons like F-35 fighter jets and missile systems.
But the restrictions haven’t been lifted, causing intense displeasure inside the Trump administration and prompting the recent series of costs imposed on China, the three administration officials said.
The decisions in Washington to limit critical technology sales to China and restrict the number of Chinese students studying in the US reveals just how central the trade war is to the administration’s overall foreign policy towards China.
It is a “unified administration strategy,” said one senior administration official in describing the connective tissue.
The actions taken in the last week will have a significant impact on Chinese tech companies and students.
The Financial Times reported on Wednesday that Trump had effectively cut off some American companies from selling software used to design semiconductors to China. A Siemens spokesperson later told CNN that the US government on Friday informed the industry about new export controls on chip designing software to China and Chinese military end users globally.
Just days later Secretary of State Marco Rubio said that the Trump administration will “aggressively revoke visas for Chinese students,” including those with connections to the Chinese Communist Party or studying in critical fields.
“On day one, the President signed an Executive Order directing the Secretary of State to enhance federal screening and vetting of aliens coming to the United States, including visa holders. The Secretary made this decision in the Administration’s ongoing effort to protect our homeland from espionage and other hostile actions,” said White House press secretary Karoline Leavitt.
The future of US-China trade talks
Treasury Secretary Scott Bessent, who Trump tapped to lead the talks and run point on the bilateral relationship, has highlighted the importance of the process the Geneva talks put into place for negotiations to take place in the months ahead.
But he has stressed the value of the “mechanism” established between the US and Chinese sides to prevent future escalations that would derail future talks or any eventual outcome.
Bessent, who led the Geneva talks with US Trade Representative Jamieson Greer, has maintained a focus on a functioning relationship and has said a second in-person meeting between the two sides is likely in the future. But Bessent has also calibrated his public comments to make clear the US has no plans to slow or stop a strategic effort to decouple from China on supply chains deemed critical to US national security.
“I would say that they are a bit stalled,” Bessent said of the China talks Thursday on Fox News. “I believe that we will be having more talks with them in the next few weeks. And I believe we may, at some point, have a call between the president and party chair Xi (Jinping).”
“I think that given the magnitude of the talks, given the complexity, that this is going to require both leaders to weigh in with each other,” Bessent said.
Growing concern within the administration in the leadup to the talks over China’s moves to cut off access to rare earth minerals sparked a wide-ranging effort behind the scenes to find potential workarounds, officials said.
That effort, which included officials from several agencies and the West Wing, wasn’t halted after the trade talks and remains a focus. But there was a view that the immediate pressure would ease as a result of the agreement reflected in the joint statement. When that did not happen, the US began to think about ways to impose costs on China.
US officials said they were not concerned about the one-two hit derailing the future of the US-China trade talks. Instead, officials are looking to make clear that not effectively engaging in the ongoing trade talks comes with consequences for the country.
“It is clearly an escalation. But if you look at what Trump does when he thinks he is getting close to securing a deal, and it’s not there yet, he tries to elevate the rhetoric. They think that elevated rhetoric and action will move a deal faster,” said one person close to the White House.
There were signs that Beijing was initially caught off guard by the visa announcement. For much of Thursday, China’s state-controlled media remained largely silent on the news that will significantly impact the fate of hundreds of thousands of Chinese students.
Then China’s foreign ministry spokesperson came out calling the move “politically motivated and discriminatory.”
Any path towards steadying the relationship across the board remains uncertain.
“The Geneva agreement was a major first step towards securing a final, comprehensive trade deal with China,” White House spokesman Kush Desai said in a statement. “Discussions continue, and the Administration is monitoring compliance with the agreement.”
It isn’t clear when the next round of trade talks between the US and China will take place. And despite saying for weeks he would talk soon with President Xi Jinping, Trump and the Chinese leader have not yet spoken amid the trade conflict.
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