US And China Remain Deeply Economically Intertwined, And Complete Disengagement Would Be Mutually Damaging, Says Chris Pereira

The U.S. and China are engaged in renewed trade negotiations following a sharp escalation in tariffs — with the U.S. imposing duties of up to 145% on Chinese goods and China responding with 125% tariffs on American imports. These moves have disrupted global supply chains and heightened economic tensions.

Recent talks, held in Geneva and described by U.S. officials as a potential “reset,” aim to reduce tariffs and reestablish more stable trade terms. While no formal agreement has been reached, both sides have shown cautious willingness to compromise, with discussions reportedly exploring tariff reductions and market access.

Despite the diplomatic tone, deep-rooted differences remain, particularly around technology, subsidies, and market transparency. The outcome of these talks will be critical not just for U.S.–China relations, but for global trade stability in the months ahead.

Chris Pereira, chief of the American Ecosystem Institute and Founder & CEO of iMpact, a leading communications and business consulting firm, recently spoke with Benzinga to share his insights on the ongoing U.S.–China trade war and its broader implications.

With over two decades of experience in China, he is widely recognized as a leading China expert, educator, and media commentator. Chris has advised hundreds of companies on branding, public relations, and international expansion, and is frequently sought for his expert analysis on U.S.–China trade relations and ongoing tariff negotiations. He is a regular speaker at universities and global forums offering deep insights on China’s evolving role in global business, geopolitics, and the future of technology.

Here’s an excerpt from the interview with Chris.

Chris, with your deep experience in facilitating cross-border business, how do you see the current U.S.–China trade tensions reshaping global supply chains?

The current tensions are accelerating a structural shift in global supply chains that was already underway. Rather than a complete decoupling, we’re seeing a strategic rebalancing — diversification, not divorce. Chinese firms are increasingly building parallel operations outside mainland China, especially in Southeast Asia and the Middle East, while many multinationals are adopting a “China+1” strategy. This allows them to manage geopolitical risks without walking away from the scale and sophistication of China’s manufacturing ecosystem. As someone who works daily with Chinese firms looking to expand abroad, I can say the push to go global is more determined than ever — but it’s also more pragmatic and nuanced.

Also Read: Trump Proposes Major Cut in China Tariffs, Signaling Shift in Trade War

Given the latest tariff measures from both sides, what kind of strategic adjustments are you seeing among Chinese firms looking to expand internationally?

We’re seeing a shift from opportunistic overseas ventures to more deeply localized, strategic investments. Chinese companies are becoming more sophisticated about compliance, branding, and building trust in foreign markets. They’re investing in local teams, legal frameworks, and strategic partnerships — not just shipping products, but embedding themselves in local ecosystems and building true connection overseas. At iMpact, we’re helping clients establish operations in the U.S., Europe, and ASEAN that are designed to be as locally integrated as possible, and not just overseas arms of a Chinese parent company. The geopolitical headwinds have made international expansion harder — but also more urgent and more professional.

How are American companies operating in China responding to the shifting regulatory and geopolitical landscape? Are they adapting, exiting, or doubling down?

The answer really depends on the industry. For sectors deeply tied to national security or critical tech — semiconductors, for instance — we’re seeing a cautious pullback. But in sectors like automotive, consumer goods, restaurants, and healthcare, many U.S. firms are doubling down. They understand that despite the noise, China remains one of the world’s most dynamic and complex markets. Smart companies are investing in localization, strengthening compliance, and de-risking their China operations without abandoning them. I would say it’s more of a recalibration than an exodus.

Do you think the current trade dynamics signal a longer-term decoupling between the U.S. and China, or are we still looking at cyclical tensions?

We’re in a phase of strategic competition that is structural — not just cyclical — but that doesn’t mean a full decoupling is inevitable. In fact, I believe a significant decoupling to be highly unlikely. The U.S. and China remain deeply economically intertwined, and complete disengagement would be mutually damaging. What we’re likely to see is selective decoupling in politically sensitive sectors, alongside continued engagement in areas where interests align. Businesses, not governments, often drive the practical realities of integration, and many firms on both sides are finding creative ways to keep doors open, even in a more fragmented world.

How do these tensions impact innovation and tech collaboration between the two nations — especially in areas like AI, semiconductors, and green tech?

There’s no question that the geopolitical rivalry is putting up new barriers to collaboration in core technologies. Semiconductors are the most obvious flashpoint, with both sides erecting walls to protect national interests. But in fields like AI and green tech, as well as bio-pharm, there’s still enormous potential for cross-border learning — albeit in more cautious, less open forms. The race to decarbonize, for instance, is a global challenge where innovation should ideally transcend borders. Likewise for healthcare advancements – no one wants to see politics hinder cancer research, for example. While government policies may limit direct collaboration, informal knowledge sharing, global talent flows, and private-sector R&D partnerships still offer bridges.

From your perspective, what role can thought leaders and business facilitators like yourself play in fostering productive dialogue and mitigating geopolitical risk?

We act as translators — not of language, but of cultural context, values, and intentions. We support communication cross-culturally, and also assist with project execution. At iMpact, we’re not just helping Chinese firms expand abroad — we’re helping them build trust, tell their story authentically, and operate with transparency in environments that may view them with skepticism. I believe that people like myself, who understand both sides deeply, have a responsibility to lower the temperature, challenge stereotypes, and create spaces for genuine dialogue. The private sector can’t solve geopolitics, but we can shape how it impacts lives, businesses, and the future of innovation.