Trump Would Consider Signing a 'Big Trade Deal' with China, Says Experienced Diplomat Kishore Mahbubani

Introduction

In the ever-evolving international trade, the relationship between America and China is preeminent in economic discussions. While former American President Donald Trump has been highly critical of his position towards China, veteran Singaporean diplomat Kishore Mahbubani believes Trump might be ready to accept an excellent trade deal.

As Mahbubani states, "The Chinese clearly want to have a deal also with the United States. They don't want this contest to carry on."

With so much at stake economically, such a deal would redefine the terms of trade between the two world's largest economies. But how might a hypothetical agreement work, and what would be its effects on the world's markets?

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The U.S.-China Trade War: A Historical Perspective

The U.S.-China trade war, initiated in 2018, led the two countries to impose tariffs on each other's imports, bringing economic uncertainty. The Trump government took a firm stance against Chinese trading practices on the grounds of intellectual property theft, unfair trade, and an enormous trade deficit.

The two countries signed the Phase One Trade Deal in 2020, which included:

• China's commitment to purchase an additional $200 billion of U.S. goods and services.
• Enhanced protection of intellectual property rights to prevent Chinese firms from stealing American technology.
• Increased market access for U.S. financial services firms in China.

China failed to achieve even 58% of its purchasing commitments under the agreement (Wikipedia).

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Trump's Second Term and a New Trade Approach

With Trump back in office, his government has wasted little time unleashing aggressive trade policies. Trump, in February 2025, issued an executive order imposing a 25% tariff on all goods from Mexico and Canada, and a 10% tariff on goods from China (Wikipedia).

Despite these tariffs, Mahbubani believes Trump may still be open to negotiating a new trade deal with China, as long as it is beneficial to American business and labor.

Former U.S. ambassador to Singapore David Adelman shared this same opinion, stating,
"China has an important stake in American economic success."

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China's Perspective: The Need for Economic Stability

China, currently suffering economic setbacks in the shape of deteriorating GDP growth, decline in foreign investment, and housing market crisis, is eager to stabilize its commercial relations with America. (WSJ)

Why China wants a trade deal:

1. Not being isolated any further – China does not wish for a Cold War-like confrontation with America, where it does not wish to repeat the economic downturn of the Soviet Union.
2. Fewer exports depending on them – A trade deal might lead China to reduce its dependence on exports and focus on domestic consumption.
3. Foreign investment – Trade easing would boost the confidence in China's economy and attract foreign investors.

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Possible Trade Deal: What Would Be on the Table?

In the event of a Trump-China trade deal, what would it look like?

• Lowered tariffs on Chinese goods in exchange for greater U.S. market access.
• Enhanced intellectual property protections to prevent forced technology transfers.
• More purchases of American agricultural products such as soybeans, corn, and pork.
• Energy agreements, including Chinese investment in U.S. liquefied natural gas (LNG) exports.
• Incentives for American businesses operating in China to ensure fair competition.

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International Impact: How the Trade Agreement Could Affect Markets

A potential U.S.-China trade agreement will have a spillover impact on global markets.

• Stock Markets – An agreement would boost investor confidence, leading to upswings in global stock indices like the S&P 500 and Hang Seng Index.
• Commodities – Agricultural prices could rise if China buys more U.S. farms.
• Technology Sector – Reduced restrictions could benefit tech giants like Apple and Qualcomm, which rely on Chinese supply chains.

Additionally, major U.S. corporations such as PepsiCo and Conagra have been lobbying for exemptions from Trump’s tariffs, citing concerns about supply chain disruptions (Reuters).

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Kishore Mahbubani’s Insights: A Diplomatic Perspective

Kishore Mahbubani, a respected diplomat and former Singaporean ambassador to the United Nations, believes that while Trump’s rhetoric on China is often aggressive, his actual policies tend to be more flexible.

He argues that both the U.S. and China understand the mutual benefits of a trade deal, and that economic pragmatism could override political tensions.

Mahbubani’s key takeaways:

✔️ Trump prefers having U.S.-friendly deals.
✔️ China craves stability and economic assurance.
✔️ There is tension between them in the spotlight but actually, they are negotiable.

Trump has done such practical planning before too, where he begins rising tensions to just negotiate and bring a win-win agreed solution.

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Challenges and Roadblocks: What Could Prevent a Trade Deal?

While there is hope, several issues could derail a potential U.S.-China agreement:

1. Geopolitical Disputes – Rising tensions over Taiwan and the South China Sea could overshadow trade talks.
2. Domestic Politics – Trump's "America First" base could resist any China concessions.
3. Tech War – U.S. curbs on Chinese companies like Huawei and TikTok could complicate talks.

Despite these obstacles, economic need can push both nations to compromise.

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Conclusion: The Future of U.S.-China Trade Relations

There is some chance at a substantial U.S.-China trade accord but not necessarily at present. Kishore Mahbubani and David Adelman's reading suggests that despite Trump's toughness, he might pursue a pragmatic approach if the deal aligns with U.S. economic goals.

With China's economy in shambles and American businesses demanding stability, both countries have good reasons to negotiate.

Key Takeaways:

✅ Trump might be open to a "big trade deal" despite his tough rhetoric.
✅ China desires economic stability and is ready to make concessions.
✅ A deal might boost global markets and ease supply chain disruptions.
✅ Challenges remain, including political tensions and tech constraints.

As 2025 continues, policymakers and international markets will closely monitor any movement toward a new U.S.-China trade agreement. Stay tuned!

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External References for Further Reading:

 China's Economic Woes Could Force a Trade Deal (Wall Street Journal)
 Trump's Tariffs: Winners and Losers (The Guardian)
 US Food Giants Look for Tariff Exemptions (Reuters)

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