Trump Administration Foreign Policy Tracker: July

June showed that the U.S.-China trade truce can coexist alongside strategic escalation. After months of delay, the Pentagon released its updated Section 1260H list of Chinese military companies operating in the United States, naming 188 entities tied to China’s military-civil fusion system. The list included major technology, electric vehicle, biotechnology, and advanced manufacturing firms. The move was overdue, but important: it signaled that the administration will continue using entity-based tools to identify and isolate Chinese companies that support Beijing’s military modernization.

Beijing responded in kind. China placed 10 U.S. firms, including rare earth producers MP Materials and USA Rare Earth, on its export-control list and restricted Chinese government procurement from dozens more American companies. It also moved to tighten enforcement against critical-mineral smuggling, underscoring Beijing’s determination to police rare earth leakage and preserve its leverage over strategic inputs. That retaliation confirms that U.S.-China competition has shifted from tariffs alone to list-based coercion, where each side uses designations, procurement bans, and export controls to shape corporate behavior.

The administration deserves credit for finally releasing the congressionally mandated 1260H list; however, China’s response shows the limits of President Trump’s stated pursuit of “strategic stability” with Beijing. Meanwhile, questions remain about whether the administration will approve a pending $14 billion arms package for Taiwan, and China has yet to show clear follow-through on the agricultural purchases announced after last month’s leader-level summit. All told, the relationship may look steadier on trade, but the underlying rivalry is hardening

June was a busy month for White House cyber policy. On June 22, President Trump signed an executive order setting deadlines for federal agencies to transition to quantum-safe encryption to mitigate the risk that U.S. adversaries achieve large-scale quantum computers before America does. The president also signed a second executive order accelerating U.S. quantum innovation.

Likewise, the White House created a voluntary AI clearinghouse to enable federal scrutiny of new AI models prior to release. Despite hopes that this system would create a predictable policy process, Washington’s export controls on Anthropic’s latest model continue to generate uncertainty around the development of this groundbreaking technology.

The White House also released a National Resilience Strategy that sets direction and principles for risk-informed resilience. While notably light on details and cybersecurity, the strategy is the first of its kind.

Meanwhile, the FBI seized 13 domains tied to Chinese intelligence operations. The bureau also launched Operation Riptide to dismantle the infrastructure enabling cyber criminals. The operation started by taking down bulletproof “First VPN,” which more than 25 ransomware groups have used since 2014.

The Federal Communications Commission extended its import ban to include legacy Huawei, ZTE, Hikvision, Dahua, and Hytera technology. This action aims to prevent Chinese technology giants from selling compromised equipment in the United States.

Finally, new Secretary of Homeland Security Markwayne Mullin told appropriators that the department is stepping up its cybersecurity efforts, noting that the Cybersecurity and Infrastructure Security Agency will need to hire 600 people to rebuild its capacity.

The Trump administration’s memorandum of understanding (MOU) with Iran lifted the U.S. naval blockade of Iran and risks weakening American force posture. By committing the United States “to remove its forces from the proximity of the Islamic Republic of Iran within 30 days after the final deal,” and to “not deploy additional forces in the region,” the MOU effectively offered Iran a veto over where and how the United States positions its forces in the region. That likely elicited cheers among the Islamic Revolutionary Guard Corps, which has sought the removal of U.S. forces in the Middle East for decades.

U.S. forces conducted strikes against Iranian targets on June 26-27 in response to Iranian attacks against commercial vessels.

U.S. European Command announced on June 3 that the United States would “rightsize its contributions to the NATO Force Model” following the administration’s 2026 National Defense Strategy, which called for “more limited support” to European defense. The drawdown will reportedly include large reductions of fighter, maritime reconnaissance, and refueling aircraft. That would build upon earlier cuts to U.S. Army force posture in Europe, furthering weakening American combat power and deterrence on the continent.

President Trump invoked the Defense Production Act on June 11 to address constraints in weapons production, highlighting the acute munitions shortfall faced by the U.S. military following sustained combat operations against Iran. The move comes as the administration struggles to pass an $80 billion defense supplemental and its $350 billion reconciliation request, both of which contain important funds for munitions production.

As Ukrainian forces stymie Russia’s advances and pound its oil refineries, President Trump seems to be recognizing that Kyiv holds more “cards” than he once assumed. This apparent shift was on display at the June 15-17 G7 summit, where Trump met with Ukrainian President Volodymyr Zelenskyy. Trump signed onto a G7 statement pledging to reinforce Ukraine’s “new momentum” and expressed willingness to tighten sanctions on Russian oil exports, urging Moscow to “make a deal.” He also said he would explore license production of PAC-3 air defense missiles for Ukraine. A Ukrainian official claimed Trump had encouraged Zelenskyy to “act more boldly” to pressure Moscow for concessions.

Of course, Trump has seemed to warm to Ukraine before, only to reverse himself shortly thereafter. The true test will be whether Washington follows through with action.

In other news, at a defense ministerial ahead of NATO’s upcoming Ankara summit, Defense Secretary Pete Hegseth announced a six-month Pentagon review of “America’s force posture and basing in Europe.” He indicated the review will test whether Europe is moving fast enough to take primary responsibility for its conventional defense. “It’s a review that some countries will fail, and others will pass with flying colors,” the secretary warned.

Separately, Hegseth forced Gen. Christopher Donahue, the highly respected commander of U.S. Army Europe and Africa, into early retirement. Donahue had played a key role in aid for Ukraine and is one of the top experts on drone warfare within the senior ranks of the U.S. military.

Secretary of State Marco Rubio met with his Gulf Cooperation Council (GCC) counterparts in Manama, where they issued a joint statement that raised the bar for any future deal with Iran. While the earlier memorandum of understanding (MOU) between Washington and Tehran appeared to require only concessions on the nuclear file, the diplomats demanded the confrontation of all forms of Iranian threats, including ballistic missiles, drones, and support for regional proxies. They further stipulated that trade and investment with the Islamic Republic must remain conditional and revocable, directly tied to Tehran’s compliance with the MOU and a halt to its destabilizing activities. The statement also said that ongoing negotiations must prevent Iran from acquiring nuclear weapons in any form.

On maritime security, the United States and GCC countries called for the reopening of the Strait of Hormuz and the guarantee of free, unconditional navigation under international law. They explicitly rejected any fees, taxes, or attempts to assert control over the waterway, significantly undermining Iran’s ability to impose passage charges.

Despite the strength of this coordinated position, divisions within the GCC have widened. Saudi Arabia and Qatar are actively pursuing reconciliation with Iran. Riyadh is preparing a peace summit, while Doha has signaled readiness to discuss the resumption of shipping through the strait. By contrast, the United Arab Emirates has adopted a more cautious stance. Having suffered the brunt of Iranian attacks, which damaged its reputation as a secure business hub, Abu Dhabi has warned against conceding to Iranian bullying.

The United States remains committed to bolstering its regional deterrence strategy across the First Island Chain by strengthening the capabilities of its allies and partners while accelerating key investments in strategic sectors.

On June 22, the United States transferred four autonomous naval drones to the Philippines Navy as part of Washington’s efforts to improve Manila’s capacity to monitor the South China Sea for Chinese activity. The transfer also represents one of the first steps in eventually equipping Filipino forces with lethal drones by 2027, ensuring that Manila can contest Chinese maritime coercion around key regional features, including in the waters around Taiwan.

The United States also sent its Typhon missile system to Kagoshima Prefecture, the southern tip of mainland Japan, as part of its Valiant Shield exercises. The missile system — which can target Chinese forces across the East China Sea — will be stationed on a U.S. military base in Japan starting in September, enhancing Washington’s deterrence across the region.

In addition, America has stepped up its regional economic statecraft strategy, including strengthening investment ties and targeting regional scam networks. On June 9, South Korea’s cabinet approved a presidential decree on Seoul’s negotiated $350 billion investment in the American economy, including $150 billion in shipbuilding-related cooperation.

On June 23, the U.S. Treasury Department sanctioned nine individuals and 26 entities linked to the Prince Group, a Cambodian-based transnational criminal organization. Southeast Asian scam centers are estimated to steal billions from American consumers each year and contribute to regional instability via human trafficking.

France called an emergency UN Security Council meeting on June 1, following an escalation of the ongoing conflict between Israel and the terrorist organization Hezbollah in Lebanon. Washington spoke with moral clarity. “Colleagues, the path is clear: Hezbollah stops attacking Israel. The Lebanese Armed Forces and the legitimate government of Lebanon assert control over Lebanese territory,” said U.S. Ambassador to the United Nations Mike Waltz.

In a June 10 effort spearheaded by America, Britain, France, and Germany, the board of the International Atomic Energy Agency (IAEA) adopted a resolution demanding Tehran provide accurate information on Iran’s near weapons-grade nuclear material and access to nuclear sites.

On June 24, IAEA Director General Rafael Grossi cited the text of the memorandum of understanding between the United States and Iran to affirm inspections would proceed. His statement followed conflicting claims from Washington and Tehran as to whether Iran had agreed to such access.

The UN Relief and Works Agency (UNRWA) terminated 70 employees on June 14, after the U.S. Agency for International Development inspector general publicized an investigation exposing that 101 current or former UNRWA staff participated in the atrocities of October 7 or had ties to Hamas.

Finally, Washington voted on June 15, along with the rest of the UN Security Council, to renew the UN Assistance Mission in Afghanistan (UNAMA) beyond the short-term extension previously agreed to in March. The mission seeks to push the Taliban to adopt humanitarian reforms. UNAMA’s mandate will now run until June 2027.

The United States and Iran signed a memorandum of understanding (MOU) on June 17 in which the Islamic Republic promises to open the Strait of Hormuz for toll-free shipping for 60 days. In return, the United States lifts its blockade of Iran, permits the sale of Iranian oil, and opens the door to further sanctions relief, along with the unfreezing of Iranian assets. Under the MOU, $12 billion in frozen Iranian assets will also be released. Iran denies American claims that Tehran will use the funds only to purchase U.S. commodities. During the 60 days, the two countries will negotiate a final deal regarding Iran’s nuclear program. President Trump said that negotiations under the MOU are continuing despite Iran striking a vessel in the strait on June 25, violating the deal and prompting retaliatory U.S. strikes.

Thus, on June 22, the Treasury Department released General License X, which authorizes “the Production, Delivery and Sale of Crude Oil, Petrochemical Products, and Petroleum Products of Iranian-Origin through August 21, 2026.” The license enables the use of U.S. dollars for these transactions without providing an escrow mechanism that would prohibit the repatriation of these funds.

The MOU declared the termination of fighting on all fronts, including in Lebanon, where Hezbollah continues to attack Israel, who is not a party to the MOU. Earlier in June, the Islamic Republic attacked Israel in response to strikes on the suburbs of Beirut, the first time the regime has launched ballistic missiles in defense of a proxy.

After flying wingtip to wingtip months ago, Washington and Jerusalem appeared less aligned in June. The United States and Iran extended their ceasefire on June 11 and later signed a memorandum of understanding (MOU) on June 17 under Pakistani and Qatari mediation — without Israeli participation.

The terms of the MOU are concerning, with cash and sanctions relief handing the Tehran regime a lifeline. The MOU also declares an immediate end to fighting in Lebanon, raising the cost of Israeli retaliations against Hezbollah provocations. Even after the MOU was signed, Iranian provocations, particularly in the Strait of Hormuz, led to renewed fighting.

In the lead-up to the Iran MOU, President Donald Trump and Israeli Prime Minister Benjamin Netanyahu held a tense phone call in which Trump called the Israeli leader “crazy” and expressed frustration that Israeli actions in Lebanon could jeopardize the Iran talks. Vice President JD Vance warned Netanyahu that the United States is the only friend Israel has left and that Israel cannot “kill [its] way” out of problems.

In early June, the governments of the United States, Lebanon, and Israel convened their fourth high-level trilateral meeting to discuss implementation of the ceasefire in Lebanon. On June 26, the trio announced a historic framework for “achieving lasting peace and security,” with Israel and Lebanon affirming “the right of each state to exist in peace.” This is a promising development, but it will require the Lebanese government to act forcefully against Hezbollah to assert its sovereignty.

Kim Jong Un’s June 3 inspection of a new weapons-grade nuclear materials facility, where he pledged to expand North Korea’s arsenal at an “exponential rate,” underscored the urgency of maintaining pressure on Pyongyang. Yet Seoul is signaling a shift in the opposite direction.

On the sidelines of the G7 summit in France, South Korean President Lee Jae Myung urged President Trump to revive diplomacy with North Korea and pressed for a phased approach that would prioritize halting North Korea’s nuclear and missile development while deferring denuclearization to a long-term goal. Lee also argued that sanctions pressure has lost its effectiveness. Similarly, South Korean Unification Minister Chung Dong-Young on June 26 called for abandoning a denuclearization-first policy, instead proposing a three-stage sequence of freeze, reduction, and only then denuclearization.

This framing is troubling because it risks allowing Seoul to redefine the objectives of any future negotiations with Pyongyang in ways that diverge from U.S. interests.

The Iran conflict has added another source of strain for the alliance. Early in the war, Trump pressed Seoul to send naval forces to the Strait of Hormuz. However, Seoul declined to do so, even as the crisis stranded 26 South Korean-operated vessels and threatened more than half of the country’s oil supply before the U.S.-Iran memorandum of understanding eased transit.

June produced the Trump administration’s most ambitious Lebanon deliverables yet. However, at times, the month’s diplomatic progress did not match enforceable realities on the ground. On June 3, for example, Washington shepherded Israel and Lebanon into another ceasefire implementation understanding, conditioned upon Hezbollah’s complete cessation of fire and the “evacuation of all Hizbollah operatives from the South Litani Sector” — though most of the group’s fighters are local residents and, therefore, monitored demobilization would have been more effective.

Positively, however, the June 3 understanding called for creating “pilot zones” under the Lebanese Armed Forces (LAF), excluding all nonstate actors. Hezbollah rejected the agreement, as it was reached through bilateral Lebanese-Israeli negotiations — which are anathema to the group.

Washington followed up with sanctions on Hezbollah’s domestic ecosystem, including designations of Amal Movement officials. But Washington was simultaneously undercutting its Lebanon progress by forcing Israel to adopt a reactive posture against Hezbollah in response to Iranian threats to end bilateral talks with the United States if Israel continued attacking Tehran’s proxy. Then, a mid-June U.S.-Iran memorandum of understanding acceded to Iranian demands to make a Lebanon ceasefire a key element of broader regional deescalation — but without requiring Hezbollah’s disarmament.

Washington nevertheless secured a major achievement, with Israel and Lebanon signing a framework agreement on June 26. The agreement requires the “complete and verified disarmament of all non-state armed groups” in Lebanon. Significantly, it conditioned phased IDF withdrawal on the LAF taking externally verified control of the pilot zones.

The Trump administration’s Iran nonproliferation policy suffered a setback in June after it reached an initial memorandum of understanding (MOU) with Tehran that lacks key specifics on the fate of Iran’s enriched uranium stockpile and future nuclear activities, sites, and assets. Similarly, the MOU fails to delineate the extent of international inspections. Under the MOU, Iran will receive substantial upfront sanctions relief, while meaningful nuclear constraints are deferred to future talks — reducing the likelihood that Tehran will accept difficult compromises.

Meanwhile, North Korea’s leader Kim Jong Un called for a further increase in the country’s nuclear weapon arsenal “with a goal of overtaking the world.” While Pyongyang’s rhetoric is typically grandiose, the regime’s arsenal has likely grown from around 35-60 assembled warheads in 2022, now with the capacity to produce roughly 20 more per year. North Korea has also steadily ramped up nuclear fuel production — including a newly revealed enrichment facility — to support additional weapons. Pyongyang continues to exploit key revenue streams for weapons development.

In a positive development, Finland has rescinded its official ban on hosting nuclear weapons on its territory, paving the way for the possible forward deployment of a transcontinental deterrent — supported by NATO and likely including French nuclear weapons — to deter Russian aggression. However, such moves are likely influenced in part by questions about the consistency of Washington’s commitment to European security.

The Trump administration continues to target the Islamic State’s and al-Qaeda’s networks in Syria and Somalia, two countries that remain hotbeds of jihadi terrorism. These strikes are what U.S. military commanders have described as “mowing the grass,” meaning that terrorist leaders and operatives are occasionally targeted and killed to degrade their organizations’ capabilities. However, historically, a policy of mowing the grass does not lead to the destruction of these groups. For instance, a U.S. policy of mowing the grass for nearly two decades in Afghanistan not only failed to defeat the Taliban, but the Taliban took control of the country in August 2021.

U.S. Central Command (CENTCOM) launched an airstrike in Syria on June 19 that killed Ali Husayn al-‘Ulaywi, whom it described as a “senior ISIS leader.” CENTCOM noted that the strike “is part of ongoing U.S. efforts to disrupt and eliminate terrorists seeking to attack Americans abroad or the U.S. homeland.” This indicates that al-‘Ulaywi was a leader of or involved with the Islamic State’s external operations network, which focuses its attacks outside of Iraq, Syria, and other areas where the Islamic State is waging insurgencies in an effort to establish and revive its Islamic caliphate.

Meanwhile, U.S. Africa Command (AFRICOM) launched at least five airstrikes against Shabaab, al-Qaeda’s branch in East Africa, in southern and central Somalia in June. AFRICOM neither provided details of the targets of the strikes nor stated whether any senior or mid-level Shabaab leaders were killed or wounded.

“I told Israel it should let Syria handle Hezbollah because, frankly, I think Syria would do a better job,” President Donald Trump said during the G7 summit in Paris on June 16. It was the second time that month that Trump had suggested an expanded Syrian role in confronting Hezbollah in Lebanon. On June 7, Trump said Syria could enable more “surgical strikes” against Hezbollah. Syrian President Ahmad al-Sharaa dismissed reports of a Syrian intervention, as did his Lebanese counterpart, Joseph Aoun.

An expanded Syrian role in Lebanon would risk giving Hezbollah a political lifeline. The Iran-backed group would likely use any Syrian intervention to recast its weapons as a shield against foreign interference. It would also give Hezbollah a rally-around-the-flag narrative, allowing the group to pressure even anti-Hezbollah communities into at least tolerating its continued armed presence.

Meanwhile, Washington removed Syria from the U.S. list of countries “not cooperating fully” with American counterterrorism efforts. However, Syria still appears on a separate U.S. list of designated state sponsors of terrorism. Washington is reportedly considering removing Syria from this list as well. Syrian officials have argued that the designation remains one of the biggest obstacles to economic recovery.

For now, the Trump administration should preserve the state sponsors of terrorism designation as conditional leverage rather than lift it outright. Washington should use the prospect of delisting to press Damascus on unresolved security concerns, including the presence of foreign jihadists within the Syrian army.

The Trump administration indicated in June that it would shift policy toward Turkey in ways that would undermine U.S. interests. First, President Trump implied that the United States was prepared to consider a potential sale of the F-35 fighter aircraft. Congress has blocked through law any potential sale due to Turkey’s acquisition of the S-400 missile system from Russia, which is dangerous because it would allow the two systems to be operated in regular proximity to each other or even networked together.

Turkish President Recep Tayyip Erdogan hopes to use the upcoming NATO summit in July to solidify momentum toward Europe’s purchase of additional weapon systems from Ankara, including drones and armored vehicles. The inclusion of Turkey in the European Union’s Security Action for Europe defense procurement program had been blocked by Cyprus, but President Erdogan remains fixated on gaining access.

The administration also notified Congress in June that it would push through the sale of jet fighter engines to Turkey for use in prototypes of the KAAN fighter. Congress has blocked the sale of engines to Turkey over concerns the engineering details may be leaked to China or Iran. The administration has stated it will pursue the sale over congressional objections.

Meanwhile, Hamas operatives are reportedly using Turkey as a haven to plan and execute terror plots against Israelis. An announcement by Jerusalem in June revealed the identity of at least five terrorists operating out of Turkey who have planned dozens of attacks in the West Bank against civilian targets.