Expert Analysis: A Detente and US Strategy

🇺🇸🇨🇳 Trump-Xi Jinping Meeting: An ‘Amazing’ Detente

President Trump has described his meeting with China’s President Xi Jinping as amazing, saying that they made a series of outstanding decisions to avert a spiraling trade war. Speaking to reporters on his flight home from South Korea, President Trump said that some tariffs would be reduced and that sales of advanced computer chips to Beijing were on the agenda. In return, President Xi had agreed to lift restrictions on rare earth mineral exports for a year. They’re vital for the manufacture of cars, planes, and weapons. He also agreed to curb production of the drug fentanyl.

Here’s President Trump speaking to reporters on Air Force One:China’s Response: Consensus and A TruceHere’s President Trump speaking to reporters on Air Force One:

“I thought it was an amazing meeting. He’s a great leader, a great leader of a very powerful, very strong country, China. And what can I say? It was an outstanding group of decisions I think that was made. A lot of decisions were made. There wasn’t too much left out there.”

💯 Trump’s Rating and Social Media Outcomes

When asked one out of 10 how he would rate the meeting, President Trump said 12.

President Trump’s statements on social media regarding some of the outcomes include:

• Farm Products: “Our farmers will be very happy,” saying China will start buying massive amounts of soybeans and sorghum and other farm products as well as American energy from Alaska.
• Rare Earths & Fentanyl: China has agreed to continue the flow of rare earth materials, and that they will help us end the fentanyl crisis.
• Respect: There is enormous respect between the two countries.

Note: China has not confirmed some of the measures mentioned by the US president.

📝 China’s Response: Consensus and A Truce

China said that there is now a consensus on a lot of these trade issues, and the details shared largely confirm and echo what President Trump told the reporters.

Key Measures Agreed Upon (for a year):

• Rare Earths: There will be a suspension of the rare earth mineral exports measures that China was going to bring in (which would have effectively throttled the export of these critical resources for modern manufacturing).
• US Tariffs: There will be an immediate lowering of the American taxes on Chinese imports for 10%.
• Shipping: China is expecting America to suspend for a year the measure that they had against Chinese shipbuilding or anything shipping-related industries.

The overall theme is that all these harsh economic measures that were made to hurt each other’s economies will be going away for a year.

“It feels more like a truce,” rather than the end of the trade war, and the next step is to see if a more permanent solution can be established and the ink put on paper. President Trump is expecting to meet with President Xi Jinping again next year in April in a trip to China.

🌍 APEC Summit Dynamics: Xi Takes Center Stage

President Trump has now left South Korea, and President Xi Jinping has arrived at the APEC summit.

• Xi’s Schedule: President Xi Jinping is going to stay here for three days at the APEC summit. He’s expected to deliver some kind of speech on the 31st with the leaders.
• Trump’s Absence: What is really notable is the absence of President Donald Trump. He chose not to stay for that main event and instead returned to America.
• Influence: The Chinese leader will now be “the biggest man in the room,” filling the void and “brushing shoulders with America’s traditional allies and other leaders.”

💡 Expert Analysis: A Detente and US Strategy

Meredith Crowley, Professor of Economics at the University of Cambridge, offered her key takeaway: This is a detente.

• Win for US: It is a big win for the United States substantially because China has agreed to allow the continued sale of rare earths (an obligation under the WTO).
• China’s Gain: China likely got very little in the way of soybean purchases but gained a lot of press time with the American president saying how wonderful President Xi is. Xi can now play that in China, making it look like a win for him domestically.

Biggest Challenges and Dual Strategy

The US has had a dual strategy since the Obama administration:

1. Pivot to Asia: Strengthening trade and investment connections throughout Asia.
2. Contain China: Ring fencing and containing China to keep it from having a deepening of its trade relationships with other partners in Asia.

The article highlights how Trump’s recent actions have aggressively pursued the ‘contain China’ strategy:

• Agreements in Malaysia and Cambodia: These agreements gave US tech companies power and secured commitments from these countries not to impose digital services taxes and to align with US security-related export controls (meaning they won’t export rare earths or chips to China if the US says don’t).
• US-Japan Agreement: Both countries committed to using their own policy tools to reduce their reliance on China for rare earth minerals.
• Export-Import Bank: The US federal government announced new investment initiatives in rare earth mining concerns in Australia.

Trump is aggressively trying to execute this contain China strategy while at the same time strengthening these commitments with other democracies in Asia