Amid intensifying trade disputes, U.S. President Donald Trump has asserted that Washington possesses “incredible cards” that could “destroy” China if deployed. Speaking at the Oval Office before a meeting with South Korean President Lee Jae Myung, Trump stressed that the U.S. holds a stronger position in its ongoing trade standoff with Beijing.

“We will have a great relationship with China… They have some cards, but we hold incredible cards. I don’t want to play them,” Trump said. Experts speculate that the “incredible card” he referred to could well be his so-called Trump Card.

If I play those cards, that would destroy China,” Trump told reporters, while also noting recent discussions with Chinese President Xi Jinping and a possible visit to Beijing later this year.

His remarks came after Washington and Beijing agreed on August 12 to extend their trade truce by 90 days, granting negotiators more time to reach a deal. The tariff war has seen the U.S. impose duties of up to 145% on Chinese imports, with most goods now facing a 30% levy. In retaliation, China slapped a 10% tariff on U.S. products.

Tensions have further escalated over China’s rare earth export policies. Trump warned that unless Beijing supplied rare earth magnets to the U.S., Washington could respond with tariffs “as high as 200%.”

Adding to the strain, U.S. Treasury Secretary Scott Bessent flagged China’s continued oil imports from sanctioned nations like Iran and Russia as a sticking point in talks, highlighting ongoing divisions even as negotiations continue.

Meanwhile, geopolitical friction extended to the South China Sea, where the Philippines and Australia conducted live-fire drills with 3,600 troops in a show of force.