Donald Trump loves to pivot. He is restless, he has some form of attention deficit disorder, and he likes to keep his enemies and adversaries guessing. Sometimes he pivots so many times, as he has on the war in Ukraine, that he completes a full circle with his pirouette.

This week, Trump is pirouetting through Asia. He has abandoned for the moment his efforts to bring Russia and Ukraine to the negotiating table, though negotiations with the Chinese might prove useful in this regard. He has also left Israel and Hamas to work it out among themselves to implement the peace deal in Gaza—which seems to be in the process of unravelling—though he stopped off in Doha on the way to Asia to refuel and chat with the Qatari political leadership about regional peace.

Like the last several U.S. presidents, Trump wants to leave behind the problems of the Old World and the mess of the Middle East. Europeans, now being prodded by Trump (and Russia’s Vladimir Putin) to spend more on their own defense, are braced for U.S. troop reductions. In the Middle East, Trump has talked about withdrawing U.S. troops from Syria and getting the last American soldiers out of Iraq. The president, or at least some of his advisors, see peace deals in Ukraine and Gaza as opportunities to once again reorient U.S. policy around the Orient.

Now that the Nobel Peace Prize is no longer dangling in front of his face like a carrot, Trump is focused on the foreign policy that matters the most to him: dealing with China. Sure, other Asian issues draw his attention, like a potential fourth meeting with North Korea’s Kim Jong Un and closer cooperation with Japan’s new conservative prime minister, Sanae Takaichi. But even here, the Nobel pushes the president forward, just like the donkey who doggedly pursues its unobtainable carrot. Negotiating a deal to end the Korean War—frozen in armistice for 75 years—could be another bid to win the prize. And Takaichi has sycophantically offered to nominate Trump just as her predecessor Shinzo Abe did.

But it’s China that holds the key to ensuring some measure of economic stability for the United States. Boiled down to a single vulgar economic transaction, Trump needs to buy China’s minerals and sell China soybeans. The economic relationship is, of course, more complicated than that—involving computer chips, TikTok, EVs, and the like—but minerals and soybeans will be at the heart of any economic deal that comes out of Trump’s trip.

Tariff War Returns

Two weeks ago, after a truce in place since the summer, it looked as though the trade war with China was coming back with a vengeance.

In mid-October, China issued export controls on rare earth elements, the class of minerals that appear in a variety of products from phones and windmills to F-35 fighter jets. Even though many countries are trying to develop their own sources of rare earth minerals, China continues to control about 60 percent of production and 90 percent of processing. Now China is using, for the first time, the “foreign direct product rule,” which allows the country to regulate any foreign trade that uses the rare earth elements or processes on its list—even if it’s a non-Chinese company engaged in the trade. It’s a tactic the United State has long used around semiconductors.

As Gracelin Baskaran of CSIS explains:

Under the measures announced today, foreign firms will now be required to obtain Chinese government approval to export magnets that contain even trace amounts of Chinese-origin rare earth materials—or that were produced using Chinese mining, processing, or magnet-making technologies. The new licensing framework will apply to foreign-produced rare earth magnets and select semiconductor materials that contain at least 0.1 percent heavy rare earth elements sourced from China.

Trump responded with his usual tactic: more tariffs. He threatened an additional 100 percent tariffs on Chinese products, on top of the 57 percent already in place, plus some tit-for-tat export controls on software.

It’s not just rare earth elements. In September, China imported zero soybeans from the United States. That’s down from 1.7 million metric tons the year before. American farmers have been hit so hard by Trump’s tariffs—and the reciprocal tariffs that have ensued— that the president has been considering a $10 billion bailout of the sector. If China resumes importing soybeans, it could lessen the pain and possibly reduce the bailout as well.

So, on the eve of Trump’s trip to Asia to attend the latest ASEAN meeting, the stage was set for either a bruising showdown with China or a kiss-and-make-up.

The Deal on the Table

Trump loves quick and bold agreements. Most of his deals, whether it’s peace or trade, are big on the headline elements and light on the details. The trade deal Trump’s negotiators strong-armed South Korea into making this week is a case in point. Achieved quickly, it’s a basically a shakedown. Seoul has to pay about $350 billion to get tariff relief on cars and semiconductors.

U.S. and Chinese trade negotiators, meanwhile, have been hard at work in Malaysia trying to thrash out their own “framework” agreement. Apparently, Trump’s 100 percent tariffs are now off the table, and China has promised to make large purchases of soybeans.

There will be “some kind of deferral” on the issue of rare earth minerals, according to Treasury Secretary Scott Bessent, which will amount to a year’s pause in China’s licensing arrangement while they “study” the issue. That will only kick the issue down the road until the next series of export controls and tariffs reignite the bilateral conflict.

The two sides also have prepared a deal on TikTok for the two leaders to sign that will allow the application to function in the United States with majority U.S. stock ownership and an algorithm outside of Chinese control. Trump will likely cut fentanyl-linked tariffs in exchange for China reducing the export of chemicals that go into the production of the drug. And Xi will probably push Trump to clarify his position on Taiwan, and who knows what Trump will say. An off-the-cuff remark about Taiwanese independence or America’s military commitment to the island could take on a life of its own and set new parameters for the trilateral relationship.

Taiwan aside, what China really wants is access to the latest high-tech computer chips, the processes for making them, and the software that runs on them. The key bargaining chip is Nvidia’s B30A, which can run the latest AI applications. China ultimately wants to make such chips domestically, but for the time being it wants access to what the West is producing. It’s the reverse of the rare earth element situation, where the United States ultimately wants to source the mineral domestically but needs access in the meantime.

Whatever the ultimate terms of the agreement, the most important take-away from the Trump-Xi meeting will be the success of China’s strategy. Xi didn’t kowtow to Trump, and, as a result, Trump has treated him as an equal. That should be a lesson for other countries, even if they don’t have the military and economic firepower of a China.

What Trump Really Wants

Despite a lot of knee-bending and gushing rhetoric from national leaders, much of the world stubbornly refuses to conform to Trump’s wishes. Putin refuses to negotiate a ceasefire in Ukraine. Venezuela’s Nicolas Maduro refuses to step down and go into exile. Canada refuses to be the beta to Trump’s alpha. Fentanyl producers have refused en masse to wrap up their operations and produce black-market Ozempic instead.

But the most frustrating of Trump’s adversaries has been China. Xi Jinping has calmly responded to every Trump move—tariffs, export restrictions—with reciprocal moves of his own. China refuses to play the fool with Trump. Its economy is formidable, and it has become the principal trade partner of more than 120 countries. It’s military, too, is big league—or bigly, as Trump likes to say—second only to what the Pentagon deploys.

Of course, Xi doesn’t want a war with the United States. He has to maintain economic growth—and that requires, at the very least, stable relations with the United States—or else he’s at risk of a palace coup or a popular revolt. The Communist Party’s chief source of legitimacy is its capacity to grow the economy. Take that away and China goes the way of the Soviet Union.

But Xi also must demonstrate China’s power in the world. This reassures nationalist sentiment within the country, China’s allies in the BRICS, and the less powerful participants in its Belt and Road investment consortium.

What Trump and his advisors care about above all is China’s challenge to American power. They worry about China’s influence in Latin America around the Panama Canal, in Venezuela, through the Belt and Road Initiative. They worry about China’s control over mineral resources, and not just rare earth elements. They’re concerned about the expansion of Chinese control near its own borders, for instance over the South China Sea. Most of the big-ticket items in the Pentagon budget are designed for an eventual war with China.

So, this latest economic deal means something very different for China and the United States. For China, it’s a necessary compromise to maintain economic performance and its business empire abroad.

For Trump, it’s an example of his successful mafioso trade policies and further proof that he can go mano a mano with the big boys. But he still expects a showdown at some point in the future. He’s not content for the United States to be a junior partner or even first among equals. Trump wants supremacy, full stop. He can overcome a pesky Venezuela or a proud Canada. But China is an entirely different matter.

These trade deals are just necessary accommodations until the United States achieves mineral independence from China. After that, the MAGA crowd wants full decoupling from China, regardless of the economic consequences. And then the path will be clear for the hardliners to push for what they’ve long dreamed of: a war with the real civilizational enemy, China.