China Weekly Roundup: Trade Shifts, Economic Moves, and Strategic Developments

Last week, China stood at the center of several defining global and domestic developments. From new trade agreements and economic reforms to energy security strategies and regional diplomacy, the country’s actions revealed how it is recalibrating for both resilience and global influence.

While economic data showed signs of slowing growth, Beijing moved assertively to stabilize its position by renewing key partnerships, boosting technological self-reliance, and reinforcing social measures at home. Here’s a complete breakdown of the most important events that shaped China’s week.

US-China Trade and Rare-Earth Export Controls

Last week, the Donald Trump–Xi Jinping summit yielded a significant agreement in the long-running trade confrontation between the United States and the People’s Republic of China. The package of measures includes

• China is suspending its planned expansion of export controls on rare-earth metals and related materials for a period of one year.

• China terminating or suspending investigations into U.S. semiconductor-supply-chain companies as part of the agreement.

• The U.S. agreeing to delay or reduce certain tariff threats (including a proposed 100% tariff on Chinese goods) and maintaining a truce for a year, giving both sides breathing room.

• China committing to resume or increase purchases of U.S. agricultural products, particularly soybeans and other key commodities.

• Both sides agreeing to cooperate on precursor chemicals linked to the fentanyl crisis and on export control/licensing transparency.

This deal effectively resets several elements of U.S.–China economic friction: China’s grip on rare-earth and critical-mineral processing is loosened (for now), and the U.S. steps back from its most aggressive looming tariffs.

China–South Korea Currency Swap and Economic Cooperation

• On Saturday in Seoul, China and South Korea signed a renewal/extension of their currency-swap agreement: approximately 70 trillion won (roughly USD 48.9 billion) for a five-year term. Alongside that, they signed six Memoranda of Understanding (MOUs) covering services trade, agriculture, investment services, and broader economic ties.

• The swap deal replaces the previous one which had expired and keeps the volume the same, signaling continuity. The accompanying MOUs reflect a push to deepen bilateral cooperation beyond mere currency arrangements.

Oil-Reserve Build-up in China

• China has been intensifying its strategic petroleum reserves program. New storage sites are under construction, with the aim of increasing crude-oil hold capacity to cover at least two weeks of imports for the country. State oil companies (like Sinopec and CNOOC) are actively importing large volumes of crude to fill these reserves.

• This step reflects China’s long-term focus on energy security and managing supply chain risk in a volatile global oil market.

Minimum Wage Hike in Tibet

• Effective 1 November 2025, the monthly minimum wage in the Tibet Autonomous Region was raised from CNY 2,100 to CNY 2,360. This change was announced via updates to local labour-policy standard tables.

• The incremental policy adjustment in a western region of China reflects ongoing efforts by Chinese regional governments to adjust wage floors in response to cost-of-living, labour supply, and economic development conditions.

Taiwan Opposition Leadership Shift and Cross-Strait Implications

• In Taiwan, former lawmaker Cheng Li‑wun formally assumed leadership of the Kuomintang (KMT) on 1 November 2025. In her opening speech she highlighted what she described as a “grave military danger” facing Taiwan, signalling concern about rising tensions across the Taiwan Strait.

• Cheng has historically advocated for closer ties with Beijing and is likely to steer the KMT toward more engagement with the mainland. Given the KMT’s parliamentary weighting (together with the Taiwan People’s Party) this shift has potential implications for Taiwan’s defence-budget priorities, legislative agenda, and cross-Strait policy, at a moment when Beijing’s posture toward Taiwan remains tense.

China’s Focus on Science-&-Tech Self-Reliance

• China’s ruling party announced a draft of its next five-year economic development plan, emphasising self-reliance in science and technology. The plan outlines a push to accelerate innovation in AI, robotics, semiconductors and other advanced sectors. The document also emphasizes expanding domestic demand, boosting income redistribution, and accelerating the transition to clean energy. Political restructuring features as well, with senior military leadership changes and anti-corruption moves.

• Date: ~23 October 2025.

President Xi’s Warning on Supply-Chain Disruption

• Xi Jinping warned at an international economic forum that breaking global supply chains would undermine stability and prosperity. He stressed that China aims to be part of resilient supply chains, not a disruptor, and that efforts must focus on collaboration rather than fragmentation. The remarks come amid heightened global worry about decoupling and shifting trade alliances.

China Tightens Rare-Earth Export Controls

• China expanded controls on the export of rare-earth elements and related technology, targeting processing equipment, recycling technology and exports to defence and semiconductor sectors. Licenses will be required for foreign firms exporting products containing Chinese-sourced rare earths or technology even if manufactured abroad. The changes take effect immediately and reinforce China’s dominant position in this strategic supply chain.

China’s Economy Slows to a One-Year Low

• New data showed China’s economy grew by about 4.8 % year-on-year in the third quarter, its slowest pace in a year. The slowdown is attributed to a slump in the real estate market, weak domestic consumption, and international trade headwinds. Retail sales weakened, and deflationary pressures mounted. The figures highlight the challenge that China faces in shifting from investment- and export-led growth to a more consumption-driven model.

Minimum Wage Increase in Tibet

• Effective 1 November 2025, the minimum monthly wage in the Tibet Autonomous Region rose from ¥2,100 to ¥2,360. This regional adjustment signals China’s continued efforts to raise income levels in less-developed areas and encourage domestic consumption, even as the broader economy slows. The step may have implications for labour cost structures in western China.

China–South Korea Currency Swap and Economic Pact

• China and South Korea renewed a large currency-swap facility worth tens of billions of USD (in yuan equivalent) for five years and signed multiple MOUs covering agriculture, services trade and investment. The deal underlines China’s strategic economic outreach in East Asia, aiming for deeper integration with regional neighbours beyond reliance on the U.S. economic system.

China Builds Up Strategic Oil Reserves

• China ramped up its import and storage of crude oil for its strategic petroleum reserves. State-owned oil companies have increased capacity and are bringing in large volumes of crude to fill storage. This move reflects China’s focus on securing a long-term energy supply and leveraging its role in global oil flows as other markets face oversupply and instability.

China’s moves last week highlighted a blend of caution and ambition. The trade truce with the U.S. and the new economic pact with South Korea showcased its willingness to negotiate, while domestic reforms from wage hikes to energy storage underscored its focus on internal stability. At the same time, the renewed call for technological self-reliance and steady military communication channels with the U.S. reflect a dual strategy: defending national interests while seeking controlled engagement abroad. In short, China’s latest actions paint a clear picture of a nation determined to safeguard its growth, manage its challenges, and assert its influence across every domain of the modern global order.

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