Chinese President Xi Jinping and U.S. President Donald Trump met for trade talks in Busan, South Korea, on October 30, in the margins of the APEC Summit in Gyeongju. Trump skipped the main events of the APEC summit, only delivering keynote remarks at a CEO lunch and attending a working dinner with APEC leaders. He said the meeting with Xi was “amazing” and a “great success”. An agreement was reached on several issues. China agreed to increase efforts to stop the flow to the U.S. of ingredients needed to make fentanyl, an opioid that is the leading cause of overdose deaths in the U.S. The U.S. had put a 20% tariff on Chinese products specifically to pressure Beijing over fentanyl, which Trump said he would now reduce it to 10%. Trump also said the rare earths issue has been settled and there would be no more roadblocks on their trade. Speaking aboard Air Force One, the U.S. President said it was a one-year agreement that would be extended. Trump also said overall U.S. tariffs on China would be lowered to 47% from 57% and that China would resume the purchases of soybeans. President Trump agreed to visit China in April and Xi would come to the U.S. at some later stage. Trump also said the Taiwan issue didn’t come up during the meeting, and the U.S. and China would “work together” on the Ukraine war.
The last time Xi and Trump met was in Osaka in June 2019, during Trump’s first term on the sidelines of the G20, and just months after trade talks had broken down. The U.S. had accused China of reneging on trade promises, and Trump raised tariffs from 10% to 20% on about USD200 billion of Chinese imports. China had hit back with its own tariffs. Today, a mishmash of overlapping industry and specific tariffs are on average far higher. But in 2019 the meeting appeared to help, with Trump declaring things to be “right back on track”. He praised Xi as a great leader, and Xi noted there had been disagreements but that it was important the relationship remain strong. Chinese stocks climbed to a decade high and the yuan currency to a near one-year peak against the dollar as investors hoped for an easing of trade tensions that have upended supply chains and rocked global business confidence, according to the British newspaper The Guardian.
The Global Times adds that President Xi said that “China and the U.S. should be partners and friends. That is what history has taught us and what reality needs. Given different national conditions, the two sides do not always see eye to eye with each other, and it is normal for the two leading economies of the world to have frictions now and then. In the face of winds, waves and challenges, we should stay the right course, navigate through the complex landscape, and ensure the steady sailing forward of the giant ship of China-U.S. relations. The world today is confronted with many tough problems. China and the U.S. can jointly shoulder our responsibility as major countries, and work together to accomplish more great and concrete things for the good of our two countries and the whole world,” Xi said.
During the meeting with Trump, Xi said that there is a good momentum in China's economic development, adding that in the first three quarters of this year, China's economy increased by 5.2% and import and export trade in goods with the rest of the world expanded by 4%. This is not an easy accomplishment given the domestic and external difficulties, Xi noted, adding that the Chinese economy is like a vast ocean, big, resilient and promising. “Over the past seven decades and more, we have been working from generation to generation on the same blueprint to make it a reality. We have no intention to challenge or supplant anyone. Our focus has always been on managing China's own affairs well, improving ourselves, and sharing development opportunities with all countries across the world,” he added.
The South China Morning Post (SCMP) reports that U.S. Treasury Secretary Scott Bessent announced that China had agreed to buy 12 million metric tons of soybeans this year and at least 25 million annually through 2028. Bessent also said on Fox News that China had approved the transfer agreement for the short video app TikTok, but provided no details.
“Presidents Trump and Xi succeeded in stemming the active bleeding in the relationship, but whether the bandage will stick remains to be seen,” said Rorry Daniels, Managing Director of the Asia Society Policy Institute. “What needs to happen next is a period of trust-building where both sides detail and deliver on their commitments and create the conditions for more substantive discussions,” she added. The U.S. agreed to pause a massive increase in the number of sanctioned Chinese companies announced in late September, which had lengthened its entity list to include subsidiaries at least 50% owned by defense-related firms already targeted. Readouts of the meeting said the two sides also agreed to cooperate on trade, energy and people-to-people exchanges.
Qiu Wenxing, Deputy Chief of Mission at the Chinese Embassy in Washington, warned that the relationship remains at a critical juncture between “deterioration” and “the right path”. “Respect for the facts should be the premise during our exchanges with our U.S. counterparts,” he said at the annual conference of the Institute for China-America Studies. “We hope that our U.S. counterparts can work with us to implement the consensus.” The headlines and deliverables have merely papered over deeply ingrained problems that defy quick solutions, analysts said.
