China announced Thursday it's soliciting feedback from businesses and local governments on proposed reciprocal tariff reductions with the United States covering approximately $30 billion in bilateral trade, marking a concrete step forward in efforts to expand commercial ties between the world's two largest economies. The move signals both nations are serious about implementing the trade framework they agreed to this year.
A Chinese commerce ministry official, Meng Huating, said Beijing is widely gathering opinions from domestic enterprises, business associations, local governments and U.S. business associations on the tariff-reduction arrangements. The United States is simultaneously seeking public comment on the cuts. Teams from both sides have maintained close communication about the tariff-reduction framework and the structure, functions and operating model of their Board of Trade, which was established after the countries reached a trade truce late last year to halt their damaging tariff war.
Trade Framework Takes Shape
China's commerce ministry said in May that agricultural products would be part of the tariff-cut framework. Beijing and Washington plan to agree on specific arrangements as soon as possible and move ahead with implementation to expand bilateral trade. The Board of Trade represents a pragmatic mechanism for resolving commercial disputes without resorting to the economically destructive tit-for-tat tariffs that characterized earlier phases of the relationship.
Security Forum Highlights Regional Fractures
Top diplomats from Asia, Europe and North America gathered in Manila for the security-focused ASEAN Regional Forum, where ministers were expected to call for a peaceful settlement of renewed and intensifying hostilities in the Middle East. The forum drew U.S. Secretary of State Marco Rubio, Russian Foreign Minister Sergei Lavrov and top officials from Australia, Britain, China, the European Union, India, Japan and others.
Maria Theresa Lazaro, the foreign secretary of the Philippines, which is chairing the grouping, said in opening remarks, "We convene against the backdrop of profound geopolitical and geoeconomic uncertainty." She added, "These issues transcend borders and underscore the reality that no nation can address today's complex security environment alone." China's Vice Foreign Minister Hua Chunying told a meeting of officials from ASEAN, China, Japan and South Korea that the world had entered a "new period of turbulence and transformation" and warned of an urgent need for peace and stability.
Rubio said a day earlier that the United States wanted a diplomatic solution in the Middle East, but Tehran wasn't playing ball. He held talks with Lavrov for just under an hour, and Russia's foreign ministry said the discussion ranged over the Ukraine war and normalisation of U.S.-Russia ties. Lavrov "reaffirmed Russia's readiness for a political and diplomatic settlement of the conflict," and told Rubio that Moscow remained committed to proposals put forward by the leaders of both nations. The U.S. State Department said bilateral relations and "the need to end the Russia-Ukraine war" figured in the discussions.
Fresh Confrontation at Scarborough Shoal
The South China Sea emerged as another focal point in Manila. Rubio described China's actions there as "disturbing" and said, "The whole world saw it, and it's disturbing." He added, "We have a role, and we're not going to abandon our allies. We've made that abundantly clear."
The Philippines accused a Chinese coast guard vessel of firing a water cannon at a government fisheries vessel near Scarborough Shoal on Thursday, with the blast scoring an indirect hit. The Philippine coast guard said water cannon was used on a government fisheries vessel that was engaged in a "purely humanitarian undertaking." China said it tracked and drove away two Philippine vessels it accused of having "intruded into" waters near the disputed Scarborough Shoal, which it calls Huangyan Dao, despite a warning.
China's Coast Guard said, "We urge the Philippines to immediately cease its infringing and provocative actions," and said the measures it took, including tracking, monitoring and interception, were "standard, professional and lawful." The Philippines and China remain locked in a territorial dispute despite a 2016 arbitral ruling—now marking its 10th anniversary—that found China's claims in the South China Sea had no legal basis, a ruling China rejects.
Pattern of Maritime Incidents
The Philippines regularly sends supplies to a small number of soldiers aboard the World War Two-era warship BRP Sierra Madre, which it grounded on Second Thomas Shoal in 1999 to assert its claims. A Filipino sailor was injured on Monday at Second Thomas Shoal after being struck with a baton by Chinese Coast Guard personnel. A violent confrontation there in June 2024—now marking its second anniversary—where a Filipino sailor lost a finger, prompted the Philippines and China to reach a provisional arrangement on resupply missions.
Manila's Foreign Ministry said on Thursday that the arrangement neither recognises any foreign jurisdiction nor requires the Philippines to ask China for permission to carry out resupply missions. China's coast guard engaged in a brief altercation with Philippine navy personnel on Monday near a disputed reef in Manila's exclusive economic zone, prompting the countries to summon each other's ambassadors.
China's Foreign Minister Wang Yi didn't attend Thursday's forum in Manila and was due to join a regional meeting in Kyrgyzstan. He told ASEAN counterparts on Wednesday the South China Sea was "our common home," where peace and stability rested in the hands of all. He said regional countries should "resist the incitement of foreign forces, oppose individual countries using the sea to make trouble," according to an official statement. Beijing began two days of live-fire drills in parts of the Taiwan Strait near the shores of its southeastern province of Fujian on Thursday, a day after Wang and Rubio held talks in Manila on a range of issues including Taiwan.
Why This Matters:
The $30 billion tariff reduction framework represents tangible progress toward restoring rational economic relations between the world's two largest trading partners, potentially benefiting American exporters and consumers while demonstrating that market-based solutions can prevail over protectionist impulses. However, the simultaneous escalation of Chinese aggression in the South China Sea—including water cannon attacks on Philippine vessels and live-fire drills near Taiwan—underscores the fundamental challenge facing U.S. policy: Beijing appears willing to compartmentalize economic engagement from its territorial ambitions. The incidents at Scarborough Shoal and Second Thomas Shoal, occurring even as diplomats gathered in Manila, demonstrate China's disregard for international law and the 10-year-old arbitral ruling. For American allies in the Indo-Pacific, the question isn't whether Washington will pursue commercial ties with Beijing, but whether those ties will compromise U.S. security commitments in the region. The answer to that question will determine whether smaller nations maintain confidence in American leadership or begin hedging their bets.