economic diplomacy

After weeks of mounting speculation, United States President Donald Trump and Chinese President Xi Jinping finally connected via telephone late Thursday evening. According to statements from both sides, the call spanned roughly an hour and a half and concentrated primarily on the bilateral trade dispute that has roiled global markets over the past year. Trump described the conversation as “very positive” and indicated that it laid the groundwork for further negotiations on tariffs. Xi, through official Chinese media, emphasized the need for the U.S. to remove “negative measures” and reiterated his willingness to deepen dialogue. With Washington and Beijing tentatively agreeing in mid-May to a 90-day pause on additional tariffs, observers are now watching closely to see whether this high-profile exchange will translate into a durable easing of tensions—or simply serve as another stopgap in a volatile relationship.

Traditional international relations theory has long defined “middle powers” by quantifiable metrics—GDP ranking, military expenditures, or population size—casting them as countries that occupy a second tier between great and small states. Under this vertical, power-based view, middle powers are seen as materially weaker than great powers but stronger than small nations. However, this framework no longer captures the dynamic influence these states exercise in today’s multipolar world. Instead, a horizontal definition—emphasizing geopolitical position, diplomatic agility, and coalition-building capacity—more accurately reflects how countries such as Indonesia, Brazil, Kazakhstan, and Turkey now shape regional and global affairs.

The Australian government has sharply criticised US President Donald Trump’s decision to double import duties on steel and aluminium from 25% to 50%, effective from June 4. Australia’s Minister for Trade, Don Farrell, described the move as “unjustified and not the act of a friend,” calling it “an act of economic self-harm” that will hurt consumers and businesses on both sides of the Pacific. Although Australia exports relatively little steel and aluminium to the United States—approximately 2.5% of US aluminium imports by volume come from Australia—Australia’s trade minister says Canberra will continue to press Washington to remove the tariffs.

A federal court this week dealt a setback to President Donald Trump’s aggressive tariff strategy, ruling that his use of the International Emergency Economic Powers Act (IEEPA) to impose broad “reciprocal” tariffs exceeds the authority Congress granted him. The lawsuit was brought by the Liberty Justice Center (LJC), a libertarian public-interest law firm whose past funders include two of Trump’s wealthiest backers, Robert Mercer and Richard Uihlein.

In a dramatic turn in the ongoing US-China trade tensions, former US President Donald Trump has claimed that Chinese President Xi Jinping reached out to him to discuss tariff-related negotiations. However, China’s Foreign Ministry has publicly denied any such communication or ongoing consultations, intensifying the diplomatic confusion and market uncertainty surrounding global trade dynamics.

As tensions mount over the looming threat of higher tariffs, Indian Prime Minister Narendra Modi and United States Vice-President JD Vance met in New Delhi this week to reaffirm both nations' commitment to an increasingly strategic and multifaceted partnership. Their discussions signaled progress in bilateral trade negotiations, even as the clock ticks on a 90-day tariff reprieve announced by U.S. President Donald Trump, set to expire on July 9.

Rachel Reeves will fly to Washington next week to meet her American counterpart for the first time, as the British government intensifies efforts to secure a UK-US trade deal.

Italian Prime Minister Giorgia Meloni is set to meet with US President Donald Trump in a high-stakes White House summit on Thursday, aiming to present herself as a potential mediator between Brussels and Washington amid rising transatlantic trade tensions.