US President Donald Trump and China's President Xi Jinping, exit together after their meeting in Busan, South Korea, on October 30. When Xi walked out of his meeting with Trump on Thursday, he projected the confidence of a powerful leader who could make Washington blink. The outcome of the talks suggested that he succeeded. Photo / Haiyun Jiang, The New York Times
US President Donald Trump and China's President Xi Jinping, exit together after their meeting in Busan, South Korea, on October 30. When Xi walked out of his meeting with Trump on Thursday, he projected the confidence of a powerful leader who could make Washington blink. The outcome of the talks suggested that he succeeded. Photo / Haiyun Jiang, The New York Times
When China’s President Xi Jinping walked out of his meeting with United States President Donald Trump last Thursday, he projected the confidence of a powerful leader who could make Washington blink.
The outcome of the talks suggested that he succeeded.
By flexing China’s near monopoly on rare earths and itspurchasing power over US soybeans, Xi won key concessions from Washington — a reduction in tariffs, a suspension of port fees on Chinese ships and the delay of US export controls that would have barred more Chinese firms from accessing American technology.
Both sides also agreed to extend a truce struck earlier this year to limit tariffs.
“What’s clear is they have become increasingly bold in exerting leverage, and they are happy to pocket any and all US concessions,” said Julian Gewirtz, who was a senior China policy official at the White House and the State Department in President Joe Biden’s administration.
Sounding almost like he was delivering a lecture, Xi said to Trump that the “recent twists and turns” of the trade war should be instructive to them both, according to a Chinese government summary of Xi’s remarks at the meeting in Busan, South Korea.
“Both sides should consider the bigger picture and focus on the long-term benefits of co-operation, rather than falling into a vicious cycle of mutual retaliation,” Xi said.
By twists and turns, Xi was likely referring to the last several months, or nearly a year, of tit-for-tat retaliatory measures in the form of tariffs, sanctions and export controls.
This month, China escalated dramatically, strengthening its hand by announcing sweeping new limits on the sales of on rare earths, critical minerals that are needed for almost all modern technology. Cutting off their supply could cripple US industries.
Xi’s message seemed to be: Beijing had proved its capacity to hit back, and Washington would do well to remember it.
“After Trump launched his trade and tariff war, China was the only country that matched the US blow for blow,” said Zhu Feng, a professor of international relations at Nanjing University, noting that the biggest win for China could be that the US might think twice before imposing new measures on China.
“If Trump had forced China to implement its complete export controls on rare earths, it would have been a lose-lose situation for both sides,” he said.
At the same time, Xi also seemed to grasp what Trump needed: a deal that he could sell as a victory at home.
The outcome allowed Trump to claim a win for American farmers and companies, even though China had largely restored the status quo by agreeing to buy soybeans and to hold off on further restricting the export of rare earths.
Trump pumped a fist in the air as he boarded Air Force One, then said on the plane that Xi had agreed to take more action to stop the flow of chemicals used to make fentanyl from reaching the US. He also said that China promised to purchase more US soybeans.
“Our Farmers will be very happy!” he posted on Truth Social afterward. “I would like to thank President Xi for this!”
US President Donald Trump, left, shakes hands with President Xi Jinping of China after their meeting in Busan, South Korea. Photo / Haiyun Jiang, The New York Times
After the two leaders met, China’s Commerce Ministry said in a statement that it would suspend for one year the restrictions on rare earths that were announced in October. The ministry made no mention of earlier controls announced in April.
Separately, Trump said he would cut in half the 20% tariffs he had imposed on Chinese goods to pressure China to do more to stop fentanyl trafficking.
The reduction announced last week brings overall tariffs on Chinese goods to around 47% from 57%, he said. The Chinese Commerce Ministry also said the two sides had agreed to a one-year extension of a truce to limit additional tariffs that was originally set to expire on November 10.
Some experts said China inevitably had the upper hand in the trade fight because the Trump Administration never had a clear objective.
“I think it’s an approach that can safely be described as tactics without a strategy,” said Jonathan Czin, a fellow at the Brookings Institution who previously analysed Chinese politics at the CIA.
“Ostensibly, the goal was to address some of the meaty trade issues that had long bedevilled the relationship. Instead, the [China] side has successfully orchestrated a game of ‘whack-a-mole’ for the Trump Administration,” Czin said.
Still, in a potential concession by Beijing, China’s official summary of the meeting did not mention Taiwan, the island democracy that Beijing claims. It is a topic that Chinese leaders usually bring up when meeting their US counterparts to pressure Washington to dial back US support for the island.
The agreements could mean at least a temporary calm in the fractious US-China relationship.
Trump said the two leaders also discussed “working together” to end the war in Ukraine. He said he would travel to China in April and Xi would visit the US after that.
Xi also played to Trump’s preference for personal rapport by appealing to Trump’s domestic agenda, saying that he believed China’s development “goes hand in hand” with the President’s “vision to ‘make America great again.’”
Trump, for his part, flattered Xi, calling him “a great leader of a great country” and a “great friend”.
“It’s a personalised style of diplomacy that plays well to both leaders’ instincts,” said Lizzi C. Lee, a fellow focusing on the Chinese economy at the Asia Society Policy Institute.
“For now, these gestures of goodwill seem to set the tone for a period of managed stability.”
Still, any progress could easily be erased by moves on either side that are interpreted as violating the agreement.
A deal struck last month was almost undone when the US expanded the range of companies banned from accessing US technology, which would have affected many Chinese companies.
China then announced its export controls on rare earths. That prompted Trump to threaten to call off last week’s meeting and to impose yet more tariffs on Chinese goods.
In the absence of a finalised agreement, it is unclear how long the current detente will last.
“Maybe I’m jaded because I’ve seen this movie too many times, but these are issues that are relatively easy to roll back and also to accuse the other side of bad faith,” said Ja Ian Chong, a professor of political science at the National University of Singapore, about the state of the truce.
