US President Donald Trump hailed a meeting with Chinese President Xi Jinping (習近平) as “amazing” and a “12” on a 10-point scale, but the agreement the two leaders reached appears to be no more than a fragile truce in a trade war with root causes still unresolved.The framework announced yesterday — that includes China resuming soybean purchases, suspending its rare earths export curbs for a year, and the US lowering tariffs on China by 10 percent — broadly rewinds ties to the status that existed before Trump’s “Liberation Day” offensive triggered mutual escalation.
The deal exposes the fundamental mismatch between what Washington wants and what Beijing is willing to offer. Absent from the talks were the big issues cited by Trump as he launched his tariffs in April — China’s industrial policies, manufacturing overcapacity and its export-led growth model.
“So what are we talking about? We are talking about de-escalation of the measures that both sides have taken since the start of the Trump administration in this kind of escalating trade war,” said Emily Kilcrease, director at the Center for a New American Security.
Photo: Reuters
The outcome underscores the robustness of Xi’s new approach to dealing with the US, which relies on a broad toolbox of measures like export controls, swiftly deployed in response to each move by the Trump administration.
An official briefed on the deliberations said the Chinese had a realistic set of expectations for this encounter — and those did not include a fundamental reset of two-way ties. Chinese officials were happy with Trump’s tone entering and his framing of the meeting as a “G2,” said the official, who declined to be named or further identified because he was not authorized to speak to the media.
China sees this as a stepping stone to a bigger meeting where they can stabilize the relationship, the official added.
Given the long-simmering tensions, the very fact that both leaders had a warm meeting — and agreed to two follow-up visits next year — offers rattled multinational corporations caught in the middle a much needed reprieve, analysts said.
Trump said tariffs on Chinese imports would be cut to 47 percent from about 57 percent by halving the rate of levies related to trade in fentanyl precursor chemicals to 10 percent from 20 percent.
The deal buys both sides maneuvering room: Trump gets a win before his planned visit to Beijing next year, Xi gets relief from elevated US tariffs that have put pressure on Chinese manufacturers.
Even this tactical victory is incomplete. China’s latest rare earths licensing curbs are delayed, not dismantled, but earlier restrictions on the critical minerals that have upended global trade remain, leaving US factories facing uncertainty in sourcing critical materials.
“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,” said Joe Mazur, geopolitics analyst at Trivium China, a consultancy.
“It’s very clear that rare earths is the primary piece of leverage, the ace in the hole that China is able to wield over the US — it doesn’t look like the US has any comparable leverage or any way of breaking the stranglehold for the time being,” he said
The agreement highlights how dramatically the relationship between the world’s two biggest economies has deteriorated since Trump’s first term, when negotiators produced a comprehensive 96-page document covering intellectual property, banking and agriculture.
CHIP RACE: Three years of overbroad export controls drove foreign competitors to pursue their own AI chips, and ‘cost US taxpayers billions of dollars,’ Nvidia said China has figured out the US strategy for allowing it to buy Nvidia Corp’s H200s and is rejecting the artificial intelligence (AI) chip in favor of domestically developed semiconductors, White House AI adviser David Sacks said, citing news reports. US President Donald Trump on Monday said that he would allow shipments of Nvidia’s H200 chips to China, part of an administration effort backed by Sacks to challenge Chinese tech champions such as Huawei Technologies Co (華為) by bringing US competition to their home market. On Friday, Sacks signaled that he was uncertain about whether that approach would work. “They’re rejecting our chips,” Sacks
NATIONAL SECURITY: Intel’s testing of ACM tools despite US government control ‘highlights egregious gaps in US technology protection policies,’ a former official said Chipmaker Intel Corp has tested chipmaking tools this year from a toolmaker with deep roots in China and two overseas units that were targeted by US sanctions, according to two sources with direct knowledge of the matter. Intel, which fended off calls for its CEO’s resignation from US President Donald Trump in August over his alleged ties to China, got the tools from ACM Research Inc, a Fremont, California-based producer of chipmaking equipment. Two of ACM’s units, based in Shanghai and South Korea, were among a number of firms barred last year from receiving US technology over claims they have
It is challenging to build infrastructure in much of Europe. Constrained budgets and polarized politics tend to undermine long-term projects, forcing officials to react to emergencies rather than plan for the future. Not in Austria. Today, the country is to officially open its Koralmbahn tunnel, the 5.9 billion euro (US$6.9 billion) centerpiece of a groundbreaking new railway that will eventually run from Poland’s Baltic coast to the Adriatic Sea, transforming travel within Austria and positioning the Alpine nation at the forefront of logistics in Europe. “It is Austria’s biggest socio-economic experiment in over a century,” said Eric Kirschner, an economist at Graz-based Joanneum
OPTION: Uber said it could provide higher pay for batch trips, if incentives for batching is not removed entirely, as the latter would force it to pass on the costs to consumers Uber Technologies Inc yesterday warned that proposed restrictions on batching orders and minimum wages could prompt a NT$20 delivery fee increase in Taiwan, as lower efficiency would drive up costs. Uber CEO Dara Khosrowshahi made the remarks yesterday during his visit to Taiwan. He is on a multileg trip to the region, which includes stops in South Korea and Japan. His visit coincided the release last month of the Ministry of Labor’s draft bill on the delivery sector, which aims to safeguard delivery workers’ rights and improve their welfare. The ministry set the minimum pay for local food delivery drivers at
RSS