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It is entirely possible that 2026 will be the most consequential year in American Asia policy in recent decades. President Donald Trump’s planned April trip to Beijing and subsequent meetings with Xi Jinping will attempt to reshape almost a decade of bipartisan competitive approaches to the PRC, with significant second and third order consequences across the region for business.

The Coming China Shift 

As has been evident for months, Trump is determined to secure a trade deal with Beijing that will result in the PRC resuming large agricultural purchases from the United States in exchange for reduced tariffs by both capitals. Trump and Xi’s smooth October meeting in Busan sets them up to achieve this, and there is little chance Trump would travel to Beijing if he did not believe a deal was in the offing.

A critical question for business, however, is what Trump intends to give to secure it. We have already seen the administration reverse course on a technology export control policy that originated in the first Trump Administration by pausing new export controls on China and then authorizing NVIDIA to sell its H20 and, more recently, H200 chips to China. More technology gives may well be in the offing.

Additionally, analysts are watching closely to see whether the administration may be willing to make changes to its longstanding policy on Taiwan, as Beijing has clearly been pushing it to do. Finally, President Trump has held a consistent interest in welcoming new Chinese investment into the U.S. economy, despite considerable opposition on Capitol Hill, and years-long trend in favor of tighter American controls on Chinese investment.

A Taiwan Shift?

The Trump Administration may be entertaining seemingly modest changes to U.S. policy on Taiwan that could have far-reaching consequences. The Trump Administration’s new National Security Strategy states that U.S. declaratory policy has not changed, noting that Washington “does not support unilateral changes to the status quo” – already a change from the typical formulation that the United States “opposes” any change. It also omits the typical American catechism on Taiwan policy, which includes references to the Taiwan Relations Act, Three Communiques, and Six Assurances; these together amount to a highly nuanced policy that is significant to both Taiwan and China.

These subtle amendments suggest the Trump Administration may be willing to make concessions on that long-held verbiage. Nevertheless, the late-2025 USD 11 billion dollar arms sales package to Taiwan reinforces the Trump Administration’s intent to continue to reinforce conventional deterrence to Taiwan, so long as Taiwan pushes forward with President Lai’s own commitment to spending more on defense. The nature of any potential change will become clearer as Trump’s trip to Beijing approaches.

The Shift Among Allies

Shifts on technology and Taiwan policy will have profound effects on the choices of American allies, including Japan, Australia, the Philippines, South Korea, and European partners.

If countries like Japan or the Netherlands believe that lax American export controls will continue, they may also make moves to resume sales to China they have prohibited, such as semiconductor machine tools. Likewise, if allies like Japan, the Philippines, and Australia, see U.S. declaratory policy on Taiwan shifting, they may begin to take independent steps to ensure their own security in a Taiwan contingency.

While it is highly unlikely that any will move away from their alliance with Washington, some may seek to diversify their defense strategies, including by making defense purchases from elsewhere.

Implications for Business 

With Trump and Xi on track to see each other as many as four times in 2026, this rapprochement may endure for year. However, if Trump’s domestic base of support flags into the midterms, Congressional Republicans may have heightened incentive to distance themselves, including on China policy, making concessions on tech or Taiwan harder to sustain.

Nevertheless, the implications for business are potentially far-reaching, but of course depend very much on the nature of the bargain that is struck.

First, so long as the rapprochement endures, it is likely to be easier for U.S. businesses to operate in China than it has been in some time, and possible that even Chinese investment in the United States may move forward. Businesses should watch closely for further changes to tech export control policy, which would not only allow for increased U.S. sales, but change the incentives of third countries, such as Japan, the Republic of Korea, and European partners, to allow their companies to resume sales into Chinese markets.

Businesses should also watch closely any changes to Taiwan policy that could seem to inject additional short-term stability into the relationship with China but may well create significant uncertainty in the Taiwan market and in third country defense choices, such as if Japan begins to diversify its defense strategy.

Business leaders should also expect far more extensive opportunities for engagement with the PRC than they have seen in a decade, including at APEC and the G20.  Finally, the possibility of backlash from the U.S. Congress in the face of these changes remains very real, although more likely to occur in the second half of the year.

Mira Rapp-Hooper is a partner at TAG. She was the senior director for East Asia and Oceania at the National Security Council (NSC) from 2023-2025, and the director for Indo-Pacific Strategy at the NSC from 2021-2023.

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