The United States chose not to sanction China’s Ministry of State Security in a bid to shore up a fragile trade truce, even amid accusations that the agency spearheaded a massive cyber-espionage operation dubbed Salt Typhoon. The reported campaign compromised a host of U.S. and global telecom firms and even breached the U.S. Army National Guard’s network. The Trump administration further paused plans for new export controls on China, as it moved to safeguard the diplomatic progress already made.
This move came after a period of heightened trade tensions fueled by U.S. tariffs and followed a meeting between China’s leader Xi Jinping and President Trump on October 30 in South Korea, which yielded a framework deal. Under its terms, Washington dropped its threat of 100 percent tariffs on imports from China, and the PRC reciprocated by lifting its export licensing requirement for critical rare earth minerals and magnets.
Therefore, the Trump administration’s choice to hold off on sanctioning China’s security agency and to pause new export curbs constitutes a strategic trade-off designed to uphold a delicate trade ceasefire. Made in the wake of the meeting with Xi Jinping, this decision signals Washington’s willingness to trade concessions on cybersecurity and export control for the sake of larger economic goals.