China trip 'not too distant', says Trump amid easing trade tensions

Business Standard

5 days ago

President Donald Trump on Tuesday said a trip to China might be not too distant, raising prospects that the leaders of the world's two largest economies may meet soon to help reset relations after moving to climb down from a trade war.
Trump made the remarks while hosting Philippine President Ferdinand Marcos Jr. at the White House, where he praised the fantastic military relationship with Manila as the US looks to counter China's influence in the Indo-Pacific region.
Yet, Trump still said the US is getting along with China very well. We have a very good relationship." He added that Beijing has resumed shipping to the US record numbers of much-needed rare earth magnets, which are used in iPhones and other high-tech products like electric vehicles.
Widely speculated about since Trump returned to the White House, a summit between Trump and Chinese President Xi Jinping would be expected to stabilise even for a short while a difficult relationship defined by mistrust and competition.
Beijing believes a leader-level summit is necessary to steady US-China relations and that Trump must be wooed because he has the final say on America's policy toward China, despite more hawkish voices in his Cabinet, observers say.
The question, however, is when.
Danny Russel, a distinguished fellow at the Asia Society Policy Institute, said Trump has consistently shown his hunger for a visit to China and that Beijing has used that to bolster leverage.
As soon as the leadership in Beijing is satisfied that Trump will be on his best behavior and will accept terms for a deal that they think are favorable, they will give a green light to the visit, Russel said.
Sun Yun, director of the China program at the Washington-based think tank Stimson Center, said a visit is in the making with two sides likely to strike a trade deal.
What Trump said might mean the visit would not be in September but "potentially November, but still depends on whether they play ball on trade and other things we want," Sun said.
Trump's campaign to impose tariffs on other countries kicked off a high-stake trade war with Beijing. China raised tariffs on US goods to 125% in response to Trump's hiking the tax on Chinese goods to 145%.
Both sides also imposed on each other harsh trade restrictions on critical products: China on rare earths, and the US on computing chips and jet engine technology.
Trade tensions, however, eased following two rounds of high-level talks in Geneva and London, when the two sides agreed to lower tariffs pending a more permanent deal by mid-August and pull back on trade restrictions.
Treasury Secretary Scott Bessent said Tuesday on Fox Business' Mornings with Maria that he will be meeting with his Chinese counterparts in Stockholm next week to work on what is likely an extension of the Aug. 12 deadline.
I think trade is in a very good place with China," Bessent told host Maria Bartiromo. Hopefully, we can see the Chinese pull back on some of this glut of manufacturing that they're doing and concentrate on building a consumer economy.
He said he also expects to bring up China's purchases of Russian and Iranian oil and Beijing's role in aiding Moscow in its war against Ukraine.
Beijing has not announced any travel plans for Vice Premier He Lifeng, who led trade negotiations in both Geneva and London on behalf of the Chinese government, but it is not unusual for China to make such announcements closer to a travel date.
In a possible friendly gesture, Beijing on Tuesday said it suspended an antitrust investigation into chemical maker DuPont's operations in China. China's State Administration for Market Regulation made the announcement in a one-line statement but gave no explanation for the decision.
DuPont said in a statement that it is pleased" with China's action.
Chinese regulators launched the investigation in April against DuPont China Group, a subsidiary of the chemical giant, as part of Beijing's broad, retaliatory response to Trump's sky-high tariffs.
Beijing also has agreed to approve export permits for rare earth elements and rare earth magnets that US manufacturers need to build cars, robots, wind turbines and other high-tech products. The US has eased restrictions on some advanced chips and other technologies.