What’s on the agenda as US secretary of state heads to China?

China and US each have priorities for Rex Tillerson’s first visit to Beijing since taking office

PUBLISHED : Saturday, 18 March, 2017, 8:30am
UPDATED : Saturday, 18 March, 2017, 8:47am

US Secretary of State Rex Tillerson will make his first visit to Beijing since assuming office on Saturday. The top diplomat of the United States is expected to meet with President Xi Jinping, Premier Li Keqiang, State Councillor Yang Jiechi and Foreign Minister Wang Yi. Among the thorny issues between China and the US, the North Korean nuclear programme and preparation for a summit between Xi and his US President Donald Trump will be the top tasks for Tillerson. Here are the top agenda items for China and the US.

For China

Finalisation of a Xi-Trump summit

It has been reported the two presidents plan to meet in April at Trump’s Mar-a-Lago estate in Palm Beach, Florida, on April 6 and 7, after their first direct phone conversation in February. While visiting Beijing, Tillerson is expected to work out the details of the meeting, which could set the relationship on a positive foundation and prove what significance Washington attaches to Sino-US ties.

An official reconfirmation of the one-China policy

Beijing was furious when Trump challenged the validity of the one-China policy, which recognises Taiwan as part of China, warning that Sino-US ties would be jeopardised if the policy was not adhered to. The tension was not eased until a phone call in February between Trump and Xi, in which Trump changed tactics and agreed to honour the policy.

To mend the damaged trust, the Chinese may want a formal recommitment from Tillerson, who represents the Trump administration, on the one-China policy.

Avoidance of a trade war

China is the largest trading partner of the United States while the US is China’s biggest export market. The two economies had yearly trade worth US$579 billion in 2016, roughly accounting for almost a quarter of the world’s total trade, with China gaining a surplus of US$347 billion.

A central facet of Trump’s election manifesto was that such a trade imbalance cost the US in business and jobs. Major punitive measures from the US would be damaging to China’s export-oriented economy and Beijing’s top officials have stressed that they don’t want a trade war.

With Tillerson, who is the former CEO of ExxonMobil, the Chinese side is highly likely to discuss measures to help balance trade between the countries as well as past threats of retaliation, in order to avoid any major conflict.

Suspension or cancellation of the THAAD deployment in South Korea

As the nuclear crisis in the Korean Peninsula escalates, with Pyongyang’s latest warning of a nuclear war made on Thursday, this is expected to be a dominant item on Tillerson’s Beijing agenda.

China, the only ally and major economic supporter of North Korea, said it has strengthened sanctions on Pyongyang, urging it to give up its nuclear and missile programmes. It has also called on Washington and Seoul to stop their regular military drills so as to not further irritate North Korean leader Kim Jong-un.

Beijing also wants the US and Seoul to halt the deployment of the Terminal High Altitude Area Defence (THAAD) system.

For the United States

A “new approach” to North Korea

North Korea’s nuclear programme has become the top security concern in the Asia-Pacific region for the Trump administration. Tillerson’s visit comes after North Korea’s latest missile launches. While in South Korea, Tillerson said 20 years of political and diplomatic efforts to deal with North Korea had failed, and military action was an option.

Will Tillerson’s China trip end in a breakthrough in the Korean nuclear crisis?

“We are exploring a new range of diplomatic, security, economic measures. All options are on the table,” Tillerson said.

“Certainly we do not want to, for things to get to military conflict,” he said. “If they elevate the threat of their weapons programme to a level that we believe requires action, then, that option’s on the table.”

Trade, market access and a bilateral investment treaty

Tillerson’s trip to China would focus on pursuing “a results-oriented relationship with China,” Susan Thornton, Acting Assistant Secretary of State from the East Asian and Pacific Affairs Bureau, said in a briefing in Washington earlier. She also said the trip would shed light on whether or not China and the US would move forward on negotiations over a bilateral investment treaty.

As both Tillerson and Trump are known for being tough business negotiators and have indicated that the new US administration would take a tougher approach towards China, Tillerson’s trip is expected to extract more concessions on trade from China.

South China Sea

Tillerson has previously said it would block China’s access to islands in the South China Sea where the Asian giant had territorial disputes with the Philippines and several other Southeast Asian nations.

Thornton said that during Tillerson’s exchanges with his Chinese counterparts in Beijing, he would show that the US “remains faithful to our allies and presses China to abide by international rules and norms”.

Currency

While Trump has repeatedly threatened that he would label China a currency manipulator, his Treasury Secretary Steven Mnuchin said the US does not have such a plan for now. Speaking on Thursday in Berlin at the G20 finance ministers meeting, Mnuchin reiterated that the US Treasury examines other nations’ currency practices in a semi-annual review and that it was working with “our counterparts and the International Monetary Fund on an ongoing basis,” Bloomberg reported.