Beijing Draws Hard Line Ahead of Trade Talks with EU and US

China is approaching trade talks with both the European Union and the United States with clear 'red lines' that it refuses to discuss. Foreign Minister Wang Yi has emphasized China's inalienable 'right to development,' which translates to opposition against US export controls on semiconductors and rejection of tariff thresholds above 20%. This threshold is significant, as it dates back to a meeting between President Trump and President Xi in Busan in 2025, where they agreed to reduce tariffs and Chinese commitments on rare earth mineral licensing.

Beijing has also pushed back against inquiries related to forced labor and overcapacity, framing them as pretexts for imposing new duties on Chinese exports. Chinese diplomats have been proactively communicating their demands and red lines to the EU, capitalizing on growing transatlantic trade tension.

The semiconductor export controls directly affect the hardware supply chain for Bitcoin mining. If China retaliates against US chip restrictions, it could impact ASIC production timelines and the geographic distribution of hash rate.