Although a first-phase agreement between the US and China was signed in January 2020, only partial tariff reductions were agreed to, and possible reversals in the future may occur. By now it should be taken as given that trade disputes between the two biggest economies in the world will be a longer-term phenomenon. Whatever the results of the current negotiations, the trade friction over the past two years will fundamentally alter some of the perceptions behind China's development strategy. Essentially, as an unfortunate and unprepared party to the trade friction, China is learning in the hard way that it needs to seriously and continuously deal with the challenges brought by institutional and structural changes in its domestic economy and a less friendly reshuffle in the international trading system.
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