Introduction
U.S.-China Trade Truce: On June 11, 2025, the governments of the United States and the People’s Republic of China announced a significant breakthrough in their prolonged trade war. Meeting in London, negotiators reached a provisional agreement referred to as a “framework truce.” This diplomatic achievement signals a potential easing of tensions that have affected global markets, technological supply chains, and bilateral political relations since the trade war began in 2018. While final details remain undisclosed, early reports indicate mutual concessions over tariff schedules, technology transfer concerns, and rare earth mineral access.
The political, economic, and legal significance of this development is substantial. Domestically, it involves presidential authority over trade policy, Congressional oversight, and the economic rights of American industries. Internationally, the agreement navigates World Trade Organization (WTO) rules, multilateral obligations, and the doctrine of sovereign reciprocity. Within these frameworks, both countries must grapple with implementing and enforcing the terms without triggering backlash or legal objections.
At the heart of this agreement lies a broader tension: How do major powers exercise economic coercion within the bounds of legal regimes while safeguarding national interests?
“The U.S.-China trade war has always been more than an economic conflict; it’s a constitutional and international legal test of power, legitimacy, and procedure,” said Dr. Helena Rosenkranz, Senior Fellow in Global Trade Law at the Peterson Institute for International Economics.
The purpose of this article is to explore that legal test in depth. We will examine the relevant statutes that empower trade policy, trace historical analogs of trade diplomacy, dissect viewpoints across the ideological spectrum, and assess the agreement’s potential consequences for the future of international law and governance.
Legal and Historical Background
The legal architecture governing U.S. trade policy includes a complex mixture of Congressional statutes, presidential executive orders, WTO obligations, and regulatory standards. Understanding these authorities is essential for evaluating the legality and viability of the 2025 U.S.-China framework agreement.
The foundation of recent trade actions stems largely from three U.S. statutes:
- Section 301 of the Trade Act of 1974 (19 U.S.C. § 2411) – Authorizes the President to impose trade sanctions on foreign countries that engage in unfair trade practices. This provision was heavily utilized by both the Trump and Biden administrations to levy tariffs against Chinese goods.
- Section 232 of the Trade Expansion Act of 1962 (19 U.S.C. § 1862) – Grants the President discretion to restrict imports on the grounds of national security. This was used to justify tariffs on steel and aluminum.
- International Emergency Economic Powers Act (IEEPA) (50 U.S.C. §§ 1701-1708) – Enables the President to regulate commerce during national emergencies, including freezing assets or restricting technology transfers.
Each of these authorities has roots in Cold War-era legislation intended to preserve national sovereignty in global markets. However, their use in prolonged economic disputes has drawn criticism. In American Institute for International Steel v. United States (2020), the U.S. Court of International Trade upheld the constitutionality of Section 232 actions, but dissenters warned that unchecked executive discretion could create a “quasi-legislative presidency.”
Internationally, the U.S. is a member of the WTO, bound by the General Agreement on Tariffs and Trade (GATT 1994). Article XXI of GATT permits exceptions for national security, but its scope remains contested. In Russia – Measures Concerning Traffic in Transit (WTO Appellate Body, 2019), the WTO acknowledged the validity of national security exceptions but maintained its authority to review their legitimacy.
“The WTO’s role in reviewing security exceptions has never been more consequential, especially with U.S.-China tensions redefining global norms,” explained Dr. Ravi Shastri, Professor of International Economic Law at NYU.
The historical roots of trade disputes with China trace back to the Nixon era’s opening of diplomatic and economic ties. The 1999 China-U.S. Bilateral WTO Accession Agreement, which paved China’s way into the WTO, was heralded as a milestone. Yet over time, concerns about state subsidies, intellectual property theft, and market access grew. The Obama administration emphasized strategic engagement. The Trump administration adopted confrontation, initiating the 2018 tariff regime that escalated into full-blown conflict.
“Every administration since Reagan has struggled with how to discipline China’s trade practices while keeping markets open. What we see now is the endpoint of three decades of policy drift,” argued Dr. Aimee Goldstein, author of The Rise of Trade Realism.
Case Status and Legal Proceedings
At present, the framework agreement remains an executive-level understanding without the force of a ratified treaty. It exists within a gray area of international diplomacy: a political commitment with economic consequences, yet lacking the binding authority of a formal accord approved by Congress or registered with the United Nations.
According to U.S. trade law, the President has broad power to enact trade measures through executive orders and proclamations. However, should the framework require long-term tariff changes or binding obligations, legislative approval may be necessary. Article I, Section 8 of the U.S. Constitution reserves to Congress the power to regulate foreign commerce. Thus, any permanent restructuring of tariff law without Congressional involvement could face legal challenges.
Indeed, bipartisan members of Congress have already expressed concern. Senator Sherrod Brown (D-OH) stated, “While we welcome de-escalation, the details matter. Congress must ensure that this framework upholds labor protections and does not sell out domestic industries.”
Simultaneously, conservative lawmakers such as Senator Josh Hawley (R-MO) warned of executive overreach: “The President cannot unilaterally reshape our trade laws behind closed doors. This needs sunlight and scrutiny.”
Internationally, the WTO may be drawn in again. China has previously challenged U.S. tariffs at the WTO, resulting in mixed decisions. Should the framework be viewed as inconsistent with most-favored-nation (MFN) obligations or violate transparency requirements under the WTO’s Dispute Settlement Understanding (DSU), it may face formal complaints.
“It remains to be seen whether this agreement will enhance or undermine multilateralism. Its design will matter far more than its symbolism,” said Dr. Claudia Hernández, trade dispute arbitrator and former WTO legal officer.
Viewpoints and Commentary
Progressive / Liberal Perspectives
Progressive scholars and policymakers generally regard trade through the lens of equity, labor protections, environmental sustainability, and global cooperation. They are cautiously optimistic about the truce but raise flags about enforceability, transparency, and long-term structural reforms.
“A truce without accountability mechanisms is just a pause in hostilities, not a solution,” said Rep. Ro Khanna (D-CA). He emphasized that the agreement should prioritize worker protections and climate goals.
Progressive think tanks such as the Roosevelt Institute argue that any trade deal must redefine metrics of success. Instead of GDP growth alone, they recommend evaluating deals based on labor rights, emissions control, and democratic oversight.
“Trade agreements are not just economic instruments—they are tools of governance. We need deals that center dignity, not just efficiency,” stated Dr. Felicia Jenkins, economist at the Economic Policy Institute.
Moreover, concerns persist about surveillance technology and human rights. Progressive activists note that trade liberalization must not normalize partnerships with state actors engaged in civil liberties violations. Calls have been made to condition future agreements on reforms related to forced labor, especially in Xinjiang.
“We cannot separate economic cooperation from human dignity. Any reset must involve rights-based conditionality,” insisted Sarah Margolis, counsel at Human Rights Watch.
Conservative / Right-Leaning Perspectives
Conversely, conservative analysts stress national sovereignty, industrial competitiveness, and the strategic containment of China’s geopolitical ambitions. Many view the agreement as a calculated maneuver to regain leverage, especially in sectors like semiconductors and critical minerals.
“China must be dealt with through strength, not sentiment. This framework must solidify our strategic supply chains, not outsource them,” warned Sen. Tom Cotton (R-AR).
Conservative legal scholars emphasize that the Constitution allows significant presidential latitude in foreign affairs, citing United States v. Curtiss-Wright Export Corp. (1936), where the Supreme Court recognized broad executive power in international negotiations.
Institutes like the Heritage Foundation argue that WTO constraints should not inhibit legitimate national security claims. “The U.S. must not allow unelected bureaucrats in Geneva to second-guess its vital interests,” declared Dr. Paul Langford, senior fellow in trade law.
Furthermore, many on the right support a move away from dependence on China for rare earths and pharmaceuticals. They propose a “decoupling” strategy through domestic incentives like the CHIPS Act and targeted tariffs.
“Strategic autonomy is the only path forward. If this deal gets us closer to that, it will have done its job,” argued Elena Masters, analyst at the American Enterprise Institute.
Comparable or Historical Cases
Historically, major bilateral economic resets have shaped U.S. trade doctrine in durable ways. Notable analogs include:
1. The Plaza Accord (1985)
In this multinational agreement, the U.S., Japan, and other industrial powers coordinated to devalue the dollar and reduce trade imbalances. While successful in stabilizing currency markets, it also triggered significant shifts in global manufacturing.
“The Plaza Accord taught us that multilateral coordination is possible but fraught with unintended consequences,” observed Dr. Kenji Watanabe, historian at Tokyo University.
2. U.S.-Japan Semiconductor Agreement (1986)
This deal compelled Japan to open its semiconductor market under threat of tariffs. Although heralded as a U.S. victory, some scholars argue it sowed seeds of long-term technological competition and resentment.
“Trade coercion can yield short-term gains, but overreach risks strategic backlash,” explained Dr. Laura Kim, technology trade expert at Stanford.
3. NAFTA and the USMCA (1994, 2020)
The original North American Free Trade Agreement and its successor, the United States-Mexico-Canada Agreement, demonstrated that trade pacts evolve with political will. Labor and environmental side agreements became core components of USMCA, reflecting changing values.
“USMCA showed that trade reform can succeed when enforcement and inclusivity are taken seriously,” said Ambassador Robert Lighthizer, former USTR.
Policy Implications and Forecasting
The implications of the 2025 U.S.-China trade framework extend across geopolitical, economic, and legal dimensions. First, markets may benefit from reduced uncertainty. Stability in transpacific relations could temper inflationary pressures and restore confidence in global supply chains, particularly for semiconductors and rare earths.
Second, the framework could redefine the U.S.’s role in international institutions. A move toward bilateralism might weaken the WTO, but success could also establish new precedents for hybrid trade models—part rule-based, part strategic.
“The agreement could either hollow out or modernize multilateralism, depending on its execution,” warned Dr. Isaac Feldman, trade negotiator and fellow at Brookings.
Third, there are domestic stakes. If Congress asserts its role, it may initiate reforms to recalibrate executive authority under Section 301 and 232, potentially through sunset clauses or enhanced reporting requirements.
Finally, allies will watch closely. Nations in the Indo-Pacific, such as South Korea and Australia, may model similar economic arrangements or use the framework to pressure China into concessions on digital trade or maritime security.
“This is not just about tariffs. It’s about rewriting the geopolitical software of 21st-century commerce,” noted Dr. Meera Thapar, policy analyst at the Atlantic Council.
Conclusion
The 2025 U.S.-China trade framework agreement marks a critical juncture in global economic governance. It represents not merely a tactical pause but a referendum on how great powers can resolve disputes in a legally sound, politically accountable, and diplomatically constructive manner.
The tension remains between executive agility and legislative oversight, between sovereignty and multilateralism, between economic efficiency and national security. These trade-offs are not new, but they are more consequential than ever in a multipolar world where legal norms are both weapon and shield.
“Trade is no longer a backroom affair of tariffs and quotas—it’s constitutional politics in economic dress,” summarized Dr. Alan Worthington, author of Sovereignty and the Supply Chain.
Looking forward, the key question remains: Will this framework become a model for peaceful economic diplomacy or a prelude to more fragmented, power-centric trade regimes?
For Further Reading
- US, China reach deal to ease export curbs, keep tariff truce alive
- US and China agree framework deal to extend trade war truce
- As US trade truce gets back on track, some Chinese exporters are ‘slowly dying’
- US and China agree to framework deal to restore trade war truce
- US, China agree on trade ‘framework’ after high-level talks
