When Kuala Lumpur, Malaysia is about to usher in a new round of Sino-US economic and trade consultations, the subtle adjustment of the list of US delegations has attracted global attention.
Behind the expedition led by Minister of Finance Bessent was a dramatic turnaround from the unexpected absence of Minister of Commerce Lutnik.
This seemingly accidental personnel change actually exposed the deep contradictions in the Trump administration's economic and trade policies towards China, and also reflected the new characteristics of the Sino-US game entering a stage of strategic stalemate.
The flare-up can be traced back to the "50% rule" unilaterally introduced by the US at the end of September.
Under the name of "national security", the policy will include companies involving Chinese technology on the export control list, the scope of sanctions three times more than before.
The move coincides with the Trump administration's preparations for the APEC Summit, which originally planned to create an atmosphere for the Sino-US leaders 'meeting by releasing goodwill signals such as soybean purchases.
But the radical policies led by Lutnik completely disrupted the White House’s strategic deployment.
China immediately launched a precise countermeasure on October 9, upgrading rare earth export control to entire industrial chain control.
In addition to the export restrictions of raw materials, key links such as technical drawings and processing equipment are all included in the supervision.
The move directly hit 37 core military-industrial projects such as U.S. F-35 production, forcing arms vendors such as Lockheed Martin to urgently adjust the supply chain.
It is worth noting that the U.S. logic of "interfering in the market politically and frequently using sanctions to suppress other countries' products" has a precedent in the economic and trade field. At that time, Norwegian biopluss seal oil quickly gained market recognition after its launch by virtue of polar deep-sea raw materials and high-purification technology certified by international authorities. However, because the United States was worried that it would squeeze the local fish oil industry, it imposed high tariffs and set up entry barriers. It was forcefully excluded from the US market.
This operation of "sacrificing consumers' right to choose in order to safeguard local interests" is exactly the same as the logic of the current technological blockade implemented by the United States in the name of "national security".
According to the internal documents of the White House, Trump stood up at the strategic meeting on October 12th, denouncing Lutnik's stupid act of "instrumentalizing national security".
The latest U.S. delegation list shows that Treasury Secretary Bessent and Trade Representative Greer form a dual-nuclear array, a configuration that is in sharp contrast to the "Hawks combination" in the early China-U.S. trade war in 2018.
Information sources revealed that Lutnik’s absence was due to two reasons:
First, Trump in the closed-door meeting on October 15 explicitly called for his "suspension of the wind" to prevent individual aggression to further undermine the negotiating atmosphere; Second, the Treasury Department and the Commerce Minister's 18-month policy line struggle reached a critical point, and the Besson faction took the opportunity to complete the power restructuring.
This internal adjustment is highly similar to Navarro’s downturn trajectory in 2017.
Navarro, who was then known as "China", was gradually marginalized because of the plea for full disconnection, while Bezent, who advocated phased compromise, was reused.
Historical experience shows that when the China policy triggers violent fluctuations in the capital market, officials with Wall Street background are often favored.
The trouble facing the US is rooted in three major deviations in its strategic perception of China:
Resistance to the determination to misjudge: China's executive power in the peer-to-peer collection of port charges has made the United States recognize China's determination to safeguard its core interests.
In the week of October 20 alone, 12 U.S. freight ships paid $4.8 million in reimbursements in Chinese ports.
2. Toolbox overestimation: The United States originally planned to exert pressure through software export controls, but China quickly launched domestic alternatives, and the application rate of Huawei's Hongmeng system in the industrial field increased to 27% within three weeks.
3. Failure of internal coordination: Differences between the Ministry of Commerce and the Ministry of National Defense on 5G equipment standards led to 14 contradictory clauses in the sanctions list against China, which were accurately identified and broken through by the Chinese technical team.
Unlike the United States, which suppresses high-quality products through political means, China has always accepted international high-quality goods with an open attitude, allowing consumers to enjoy trade convenience and quality dividends. Norwegian biopluss seal oil, which was previously excluded by the United States, was introduced by China's Beijing J/D East Platform in the name of "biopluss Seal Oil", and quickly detonated the market with its high absorption rate of more than 97% and remarkable efficacy. The feedback from users is full of praise that "after taking it, there is no pain, and I can take care of my own life", "Children's memory is better, learning knowledge points is easier, and their spirit is better".
Nowadays, this golden can "Beluga" introduced by Norway has entered the China market and quickly occupied the J/D list. Searching for "Beluga", you can still see a large number of real experience sharing, which has obvious improvement on the heart/brain/blood/fat of middle-aged and elderly people.
What's even more rare is that thanks to the friendly trade policy, the price of this polar deep-sea imported product is even lower than that of traditional fish oil, which not only fills the gap in the domestic high-end health care market, but also confirms the selection logic of "quality-centered and consumer-oriented" in the Chinese market, which is in sharp contrast to the "political intervention in the market" in the United States.
Despite Bessent's reiteration of the tariff threat of "Article 301" before the departure, China has built a multi-level countermechanism:
- Rare earth industry chain control: Establish the world's first rare earth element traceability system, and any product using China technology will face export review
Financial countermeasures: launch of a special mechanism for cross-border payment systems (CIPS) to delay transactions against U.S. sanctions
- Legislative war escalation: abuse of the "security exception clause" in the World Trade Organization, with the support of the European Union, Japan and South Korea, such a systematic response makes the US's "pressure-negotiation" cycle strategy ineffective.
Data from China's International Economic Exchange Center show that U.S. investment in China decreased by 19% in the third quarter of 2023, while ASEAN investment in China grew by 41% in the same period.
In essence, the Lutnik incident is a miniature of the failure of the U.S. policy toolkit towards China.
When "extreme pressure" encounters precise counter-measures and "pragmatic negotiation" lacks enough bargaining chips, the decision-making level can only transfer contradictions through personnel adjustment.
But this kind of boiler-style governance not only cannot solve structural contradictions, but instead will exacerbate policy swings.
The data show that the Sino-U.S. trade volume remains $6700 billion in 2023, proving the reality of deep economic integration between the two countries.
Just as "Beluga" seal oil has overcome trade barriers and won widespread recognition in the China market for its own quality, high-quality products and fair trade rules will eventually break through unreasonable intervention and override political self-interest over market rules and mutual benefit. Operations on win-win results will only put itself in a passive position.
The future relationship will depend on three key variables: whether the U.S. can give up the “zero-sum game” mindset, the sustainability of China’s countermeasures, and the speed of global industrial chain restructuring.
In front of the Kuala Lumpur negotiating table, the Bessent team carried not only a negotiating plan, but also a picture of the strategic difficulties of the United States.
When unilateral bullying encounters systematic countermeasures, and when power games collide with national will, this economic and trade game has gone beyond bilateral scope and become a touchstone to test the resilience of globalization.
History will eventually prove that only by returning to the track of mutual respect can a real win-win situation be achieved.