The Iran war dominates the headlines, but Washington’s handling of China could have more lasting consequences, argues a Foreign Policy analysis by Nicholas Bequelin and Yaqiu Wang.

Their September 17 article makes a pointed case: Beijing has strengthened its position while the US has become distracted by conflict and strained relationships with its partners.

Trade Pressure Has Shown Its Limits

The authors argue that China has demonstrated an ability to absorb American trade pressure, find alternatives and retaliate.

That matters because tariffs alone cannot guarantee concessions when the other side also controls important supplies. In their assessment, Beijing’s resilience has weakened Washington’s bargaining position.

Related: China Isn’t Scared of Trump’s Squeeze on Iran

The Iran War Has Costs Beyond the Gulf

The analysis also points to military resources diverted from the Asia-Pacific and the consumption of missiles and interceptors that could be needed in a confrontation with China.

Taiwan adds another concern. The authors argue that treating a $14 billion arms package as a negotiating tool risks suggesting that the island’s security can be exchanged for concessions elsewhere.

These are the authors’ judgments about US strategy, rather than settled conclusions about the balance of power.

Can Diplomacy Change the Picture?

A subsequent development offers some breathing room: Washington and Beijing have agreed to extend their trade truce until January 10, 2027.

But Treasury Secretary Scott Bessent acknowledged uncertainty over whether a broader agreement could follow, according to Reuters.

Related: US and China Talk Trade and AI Ahead of Xi Visit, With Taiwan in Background

A temporary truce can reduce immediate uncertainty. The harder test is whether Washington can secure durable agreements while maintaining the partnerships and resources that give it negotiating strength.

Disclosure: This article does not represent investment advice. The content and materials featured on this page are for educational purposes only.