The war is at its peak,but it is a truce in a finger-biting game.

Washington and Beijing are preparing for a summit to be held in South Korea between Trump and Xi Jinping. The eyes of the world are turned toward what the meeting may yield in results that redraw the contours of the international order, or entrench a long-term struggle between the two largest economic and military powers. This is not merely a negotiation over customs duties or trade provisions; it is a test of deeper balances that touch on regional security, technological hegemony, alliance networks, and the rules of the geopolitical game in their entirety.

By its structural nature, the conflict transcends the notion of a passing crisis. Rather, it grows more complex day by day, its threads interweaving in the economy and technology, and trade calculations intertwining with strategic equations. Unlike traditional conflicts, this war is waged without smoke, yet it is more impactful, given its creeping character and its deep, long-term repercussions and imbalances.

The main link in this battle is the markets, encompassing the cycles of production and distribution: from trade and energy to supply chains, and from semiconductors and quantum computing to rare metals that are vital to electronic and defense industries. While Washington seeks to reshape its chains and reduce its dependence on Beijing’s dominance over resources, China considers the liberalization of the flows of these materials, especially rare metals, a main part of its security and bargaining power.

Back when U.S.–Chinese relations were proceeding with relative smoothness, Chinese leader Deng Xiaoping’s approach to territorial disputes with China’s neighbors was pragmatic: “Our generation does not possess enough wisdom to solve this issue; let us leave it to the next generation, which will be wiser than us.” Today, however, the island of Taiwan has become a central knot in the tension: the United States sees that a Chinese adventure there would undermine its credibility and its alliances in East Asia and across the Pacific, while Beijing regards it as part of its territory and as a platform to project its power in the eastern Pacific.

On the international level, the struggle over quantum intelligence, the infrastructures of digital control, and data governance and its standards represents the most dangerous and decisive file in the intensifying race to dominate hard digital hardware. As competition doubles month after month, in a climate of risks and global fragility, technological superiority becomes decisive for the national security of each of them. Nevertheless, there is a possible common ground between the two countries that springs from their need to establish rules for the governance of emerging technologies and to regulate the global digital architecture, in a way that averts sliding into a chaos of standards and races of mutual bans. Despite its extreme difficulty, this may be the most worthwhile opportunity that the negotiations offer.

At the table of power, the United States possesses decisive advantages: relative technological superiority; a wide, transcontinental network of alliances; a solid innovation system that rests on universities and companies whose knowledge capital is unmatched; and the dominance of the dollar, which grants it exceptional financial and regulatory tools of influence. Added to this is a giant domestic market capable of absorbing shocks and accommodating cycles of investment in expensive technologies.

But China in turn holds pivotal cards: a deep positioning at the heart of global supply chains, and an ability to influence vital inputs for many American industries, from critical minerals to electronic components. In addition, the dependence of segments of the American economy—especially farmers—on the Chinese market gives Beijing room for bargaining, after it invested in alternative suppliers in Brazil and South America. The file of rare metals is considered an immediate, sensitive pressure card, for disrupting them inflicts severe harm on advanced industries.

Conversely, China faces grave internal challenges: a mounting demographic crisis, economic slowdown, and structural deficiencies in the financial and banking sectors, which may limit its ability to bear the cost of a long confrontation. These points do not negate the elements of Chinese power, but rather set their ceiling and draw Beijing’s calculations into a framework of “cost–benefit balance” in the medium and long term.

As for Washington, although the sources of power are plentiful, the Trump administration’s approach appears experimental and volatile, mixing tariffs, restrictions, and ad hoc deals and shifting priorities in a way that confuses allies and adversaries alike. By contrast, the centralization of decision-making in Beijing gives Xi Jinping the ability to mobilize quickly and to use the instruments of the state with higher efficiency. Yet American experts point to the cost of excessive centralization and to signs of economic and demographic slowdown. And while Xi Jinping does not face an imminent domestic test, Trump remains under the weight of upcoming electoral deadlines that may directly affect his margin for maneuver.

Washington can diversify its sources of critical minerals and build alternative chains, a path that does not require extraordinary technologies so much as it requires investments and infrastructure that take years—seven at least—to bear fruit. During this temporal gap, Beijing can take advantage of the short-deal approach that Trump prefers to extract concrete concessions without high political costs. Here lies the appeal of a “tariff truce” for both parties: buying time for repositioning, not striking a final deal.

The Center for Strategic and International Studies (CSIS) rules out reaching a “grand bargain,” but financial markets have reacted with a tone of cautious optimism, with an awareness of fears they have previously experienced—a déjà vu. Reports indicate reaching a “framework” to reduce tariffs on some goods in exchange for Beijing easing restrictions on the export of rare metals. But the real work begins after the summit: the details of implementation, verification mechanisms, and building mechanisms that fortify the agreements. The essential question for policymakers, companies, and observers is not: Will there be a deal? Rather: What form will it take? How binding will it be? How will it be implemented and monitored, and through which dispute-settlement mechanisms?

Thus, the most likely outcome is a limited deal that does not come close to the thorny files: Taiwan, semiconductors, the standardization of digital infrastructures, and the battle for quantum supremacy. These would require heavy political and strategic concessions at the expense of Washington’s credibility with its allies, while Beijing does not seem ready to pay heavy prices. Just as both sides rule out a resounding failure, they also rule out a comprehensive breakthrough.

The results of this confrontation go beyond bilateral relations to the heart of international balances. At the center of this equation lies the Gulf and the Middle East, with the energy, markets, sea lanes, and growing digital infrastructures they represent. Accordingly, the choices of regional capitals—in positioning, connectivity, and participation in the new value chains—will have a multiplied impact in shaping the coming scene.

It is, then, nothing more than “a truce in a finger-biting game”: hands rest a little, but the nerves remain taut and the war stays at its peak—economically, technologically, and strategically. What comes next depends on the ability of both sides to translate the moment of de-escalation into the building of sustainable rules, or to let it turn into yet another station in a series of postponed escalations.