Prime Minister Christopher Luxon says Thursday’s meeting between US President Donald Trump and Chinese leader Xi Jinping proves the value of leaders getting in a room together and thrashing out differences.
Trump and Xi met for the first time in six years in Busan, South Korea. Both leaders were in the Asian nation for the annual Asia-Pacific Economic Cooperation (Apec) summit, though Trump has since departed back to Washington DC.
Speaking on Air Force One, Trump said the pair had an “amazing” meeting that he would rate 12 on a scale of one to 10. Although official agreements have not been signed, the President was confident deals would be finalised shortly.
Luxon said it was “very positive when you’ve got the leaders of the first and second biggest economies in the world actually continuing to talk and to ease tensions and de-escalate”, and that “any conversation” is worthwhile.
He has repeatedly made the point during his visit to summits in Malaysia and South Korea this week that there is significant value in meeting face-to-face with other world leaders to build relationships and address issues, such as disruptions to global trade.
Trump’s so-called Liberation Day tariff regime and subsequent sporadic social media trade threats to other countries have caused tumult in the international economy and markets. In contrast, Luxon has in part been using his trip to Asia to try to reinforce the value of more order and rules in the trading system.
Among the decisions made during the Trump-Xi meeting was to lower tariffs on certain Chinese imports into the United States, which would have the effect of bringing the total effective tariff rate for the China’s goods down from 57% to 47%.
This stepdown was attributed to what Trump said was Xi’s commitment to crack down on the flow of fentanyl across the two countries’ borders.
Trump also claimed that China would delay strict export controls on rare earth minerals, critical for their use in many products, like smartphones and electric vehicles.
Beijing’s decision to impose these restrictions infuriated the US President earlier in October, causing him to threaten additional tariffs and to potentially pull out of the meeting.
China is also planning to purchase large amounts of soybeans from the United States, according to Trump.
“The agreements reached today will deliver Prosperity and Security to millions of Americans,” Trump said on social media, before thanking countries he had met with during his tour this week of Asia.
That included mentioning New Zealand and other countries who were at an Apec leaders’ dinner last night. It was during a brief meeting prior to that in which Prime Minister Christopher Luxon had his first in-person meeting with Trump.
A readout from China’s Ministry of Foreign Affairs reiterated comments Xi made at their meeting, including that given the countries’ “different national conditions”, it is “normal for the two leading economies of the world to have frictions now and then” and “not always see eye to eye”.
Asked what decision from the meeting stood out to him, Luxon mentioned the rare earth minerals, but also the comments from Xi that two big economies won’t always be on the same page.
“I think that is a reality. I think being straight up about that reality is okay and it’s perfectly reasonable to have that position,” the Prime Minister said.
“But for me, it just gets back to this simple level. The more that those leaders are talking together, the more that they are planning on moving this thing forward, and the more that they can de-escalate those tensions, that is a benefit to us all.”
On New Zealand’s trading relationship with China – our largest trading partner – Luxon said it will continue to “be very, very important to us”, also signalling there are “areas where we can cooperate even further with China and deepen out our trade”.
He said the rising middle class in China “creates a huge opportunity for New Zealand”.
In recent years, there has been calls for New Zealand to diversify its trading relationships, so as not to be so reliant on China.
Luxon suggested New Zealand can strengthen its trade with China while also developing new partnerships, listing off various agreements New Zealand has signed or is looking to sign with other countries.
“We want the foot fast on the accelerator. I want to create more opportunities and more optionality for New Zealand businesses to be able to trade anywhere they want to in the world.”
On Thursday, Luxon held a bilateral meeting with South Korea’s President Lee Jae Myung during which they signed a Comprehensive Strategic Partnership, elevating the two countries’ relationship and committing to a number of initiatives, like strengthening law enforcement, defence and science cooperation.
Luxon said that agreement “puts us into a priority within the system that means that they want to work with us more”.
The Prime Minister also visited the United Nations Memorial Cemetery in Busan, where many of the New Zealanders who died during the Korean War are buried.
He attended a business event at Skyline Luge, New Zealand’s largest investor in South Korea.
And capping it off, Luxon had dinner with Australian PM Anthony Albanese, Canadian PM Mark Carney and Singapore PM Lawrence Wong.
Jamie Ensor is a senior political reporter for NZ Herald travelling with the Prime Minister in Asia this week.