A potential escalatory spiral in the Middle East could push forward trade negotiations between the world’s two largest economies, said Xu Weijun, an assistant research fellow at South China University of Technology’s Institute of Public Policy.
“An intensifying situation would force the US to allocate more strategic resources there, leaving fewer resources available for competition with China in the Indo-Pacific, thereby easing pressure,” he said.
“On the other hand, one key focus of trade talks is rare earths, which are critical to modern technology and defence industries – and arguably a strategic vulnerability for the United States. As tensions escalate in the Middle East, Washington’s urgency to secure these resources is likely to grow, giving Beijing more leverage at the negotiating table.”
China and the US remain locked in a tense stalemate over tariffs and other trade issues, with the most recent talks in London yielding little tangible progress.
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