While this is possible, there are also reasons to believe the bravado on show by both sides is a psychological negotiating tactic. The two countries are expected to resume negotiations soon and that both say they are open to further negotiations is a positive sign.

If Trump and Xi agree ‘grandaddy’ of trade deals, here’s what comes next

Judging by the voluminous media reports, miscalculations on both sides seem to have unravelled a deal, which many had expected to be made soon.

Over the past few months, Trump and his top negotiators have used Twitter and the American media to lead public opinion over the progress of the talks, while Chinese officials – true to their secretive nature – have largely stayed silent.

It was only after Trump accused China of backtracking on promises made in the negotiations and hiked the tariffs that Liu He, China’s vice-premier who is in charge of negotiations, gave a detailed explanation of the three main stumbling blocks to a deal, from Beijing’s point of view.

Firstly, Beijing wanted any tariffs Trump had imposed since the beginning of the trade war to be removed before the deal was made. Secondly, it wanted a realistic target for the US demand that China expand its imports of American goods.

Finally, it wanted to change the wording of the draft agreement so that it was more balanced and protected China’s dignity.

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From the Chinese perspective, the last one seems to have been the deal-breaker, as what Liu inferred was apparently related to the US demand that Beijing should not oppose or retaliate against the US decision to unilaterally impose additional tariffs on Chinese imports if Washington deems Beijing to be in breach of the trade deal.

The US said the main sticking point was Beijing backtracking on its commitment to enact laws to codify policy changes on issues such as intellectual property protection. Instead, Beijing wanted to undertake those changes through decrees from the State Council, which the US found objectionable.

Here comes the mystifying part: ever since the beginning of the negotiations, Washington has made it very clear that Beijing needs to agree to very strong enforcement provisions for an eventual deal, given its record of not living up to its commitments.

But Washington should also know that Beijing would never agree to the US demand that it could unilaterally punish Beijing for breaching the agreement, for historical and political reasons.

The past humiliations China suffered from accepting “unequal treaties” imposed by Western colonial powers in feudal times have long made the Chinese sensitive to any perceived imbalance in international agreements.

Politically, Xi has consolidated his power to become the country’s most powerful leader since Mao Zedong and proclaimed China’s intentions to become a world power. There is no way he would allow such language in the final agreement because accepting such wording would seriously sap his political standing and authority at home.

In that case, why did Beijing allow Washington to believe that it was agreeable to such demands in the first 10 rounds of talks before proposing the significant changes?

This could well be one of Beijing’s negotiating tactics. It is known for driving a hard bargain at the last minute.

In Trump’s trade war on China, the winner will be whoever can stand to lose the most

Indeed, Liu defended Beijing’s tactics by saying that it was normal for there to be ups and downs and it was irresponsible to casually accuse one party of “backtracking” while the two sides were still negotiating. Liu said he was still cautiously optimistic.

Ever since the impasse, the Chinese official media have ramped up the propaganda and hardened the rhetoric, saying that Beijing would not cave in to external pressure and the Chinese economy was resilient enough to withstand the economic shocks from a prolonged trade war with the US.

Some commentators in the state-run Chinese media even suggested China should stop purchasing US agricultural products and energy, reduce orders for Boeing planes, and even dump US treasury securities, to hit the American economy where it hurts.

While there is little doubt that those measures may be part of the contingency plan for the worst-case scenario, the Chinese government is very unlikely to take those measures simply because bilateral ties have not yet deteriorated to a stage where such actions would be warranted.

From China’s perspective, fighting with Washington while avoiding escalating matters out of control is still the preferred strategy as Beijing intends Washington to meet it halfway.

Why Trump’s trade war is a blessing in disguise for Chinese leaders

During Liu’s latest talks in Washington, he reportedly told the US negotiators there was nothing more he could do and that it would be up to Xi and Trump to work the deal out.

Ever since the trade war started, Trump has occasionally suggested only he and Xi could seal the deal.

Come to think of it, this rather fits the characters of both men. Trump likes to say that he is his own man as far as all the important decisions from the White House are concerned and, in Xi, he has certainly met his match.

At the last G20 meeting in Buenos Aires, Xi and Trump met and declared a trade truce. Let’s hope that at their G20 meeting in Japan they will bring home the bacon. ■

Wang Xiangwei is the former editor-in-chief of the South China Morning Post. He is now based in Beijing as editorial adviser to the paper