Its next chapter will be fought through export and import controls, investment restrictions, and sanctions—and the United States should prepare itself now.

The U.S. and China are said to be close to signing a phase-one trade deal in early January a move that will see Washington reduce tariffs on Chinese goods, or at least temporarily calm fears of an escalating trade war between the world's two largest economies.

In a year which began with the 40th anniversary of official US-China ties, the two countries remained caught throughout 2019 in an economic and geostrategic tussle which appears to be spiralling towards a superpower showdown under the watch of two nationalistic, headstrong leaders.

After nearly 18 months of tit-for-tat tariff increases, the United States and China have reached a “phase one” agreement to start de-escalating their trade war. As part of the deal, US President Donald Trump canceled further tariff increases on Chinese goods that had been scheduled to take effect on December 15, and halved a 15% tariff on $120 billion worth of imports from China. As for China, it shelved its planned retaliatory measures and committed to import some $50 billion worth of US agricultural products in each of the next two years.

The broad insights from the agreement are important for global discourse on trade & economic integration.

China on Thursday unveiled a new list of import tariff exemptions for six chemical and oil products from the United States, days after the world's two largest economies announced a Phase 1 trade deal.

Economists continue to puzzle over the details of the US-China phase one deal announced last Friday, particularly Washington’s demand that Beijing imports an extra US$200 billion of American goods and services over two years.

There is too much “fraternising with the enemy” for US–China economic ties and global technology ecosystems to be disentangled into neat geopolitical coalitions.

Think of the pact as a break in hostilities while both sides take care of short-term domestic interests.

The preliminary trade deal between the United States and China is the first step in correcting an imbalance of more than $300 billion in commerce between the world's two economic superpowers.