Trump has the ‘superlatives,’ but Xi has that ‘truce’
‘It’s clear that rare earths’ are ‘the ace in the hole that China is able to wield over’ the US
Donald Trump spouted a string of superlatives after his tête-à-tête with Xi Jinping today. But the face-to-face talks between the two presidents on the sidelines of the APEC summit in South Korea ended with a tactical truce, not a trade deal.
In spite of Trump’s usual hyperbole peppered with “tremendous,” “great,” and “amazing,” Chinese leader Xi walked away with The Art of the Deal in his back pocket. The meeting lasted about 100 minutes in the city of Busan, throwing up more questions than answers.
“I think that what we’ve seen this year has been a more or less total vindication of China’s strategy of never striking first but always striking back,” Joe Mazur, an analyst at research and consultancy Trivium China, told the Reuters news agency.
“It’s very clear that rare earths [are] the ace in the hole that China is able to wield over the [United States]. It doesn’t look like the US has any comparable leverage or any way of breaking the stranglehold for the time being,” he said.
Truce in our time:
- China decided to pause export controls for a year on rare earth minerals, which are crucial to power the technologies of today. It also agreed to buy more American soybeans.
- But the United States was forced to cut fentanyl-linked tariffs by half and reduce duties on Chinese goods to 47%. That will be a relief for businesses caught in the trade war.
[Overall,] the agreement falls short of a comprehensive trade deal.
Semafor
Delve deeper: Trump also appeared to open the door on exports to China of AI chips made by American high-tech leader Nvidia. But it would not include state-of-the-art Blackwell semiconductors. Still, it would be a big win for Beijing in its artificial intelligence push.
Between the lines: “[Overall,] the agreement falls short of a comprehensive trade deal or a structural realignment in the countries’ rivalry,” media website Semafor pointed out. “Talks between the pair ‘will go on for a long time,’ Trump acknowledged.”
Big picture: There are other challenges that lie ahead. Chinese academic Da Wei warned that the “personal rapport” between Xi and Trump was fragile and risked being ruptured if the truce broke down in the coming months.
Bottom line: “If the escalation of tensions happens [again], trust between the two leaders at a personal level will run out. Then we will have a very difficult situation,” the director of Tsinghua University’s Center for International Security and Strategy told the media.
China Factor comment: Illustrating that point, Trump ordered the American military to resume nuclear weapons testing after 33 years just before the Xi summit. The move has threatened to trigger a new global arms race between Washington, Beijing, and Moscow.