Opinion: Xi and Trump learn to split the difference on trade and North Korea

The presidents of China and the US steer their countries through compromise away from destructive escalation

PUBLISHED : Monday, 10 April, 2017, 12:04am
UPDATED : Monday, 10 April, 2017, 2:27am

The summit between the world’s two most powerful leaders was surprisingly amicable and constructive. Both sides managed to stick to the script, projecting a shared commitment to responsibly manage their relations.

US President Donald Trump and his Chinese guest, President Xi Jinping, seemed cordial, subdued and focused on the difficult task of navigating the most consequential bilateral relationship of the century. The meeting was also partly overshadowed by the White House’s decision to bombard Syrian bases in an apparent punishment of Syrian President Bashar al-Assad regime’s alleged use of chemical weapons against civilians.

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As the Tomahawk missiles pulverised Syrian targets, Trump and Xi gently wined and dined at Mar-a-Lago resort in Florida.

Unlike Trump’s meeting with Japanese Prime Minster Shinzo Abe, there was no golfing with Xi, who has banned Chinese officials from the sport as part of a crackdown on corruption.

And contrary to Trump’s campaign promise, there were no Big Macs on the evening menu, but instead a lavish feast. Both leaders conducted themselves with professionalism and relative ease. Undoubtedly, this was a huge let-down for those expecting a more dramatic encounter. After all, ahead of the summit, Trump openly fretted about a “very difficult” meeting with his Chinese counterpart.

Above all issues, trade has been the main bone of contention between Trump and China. The American leader, who during his election campaign used China-bashing as a rallying point among disaffected blue-collar workers, said his country “can no longer have massive trade deficits” with China, warning American companies to “be prepared to look at other alternatives” in the event of a full-fledged trade war.

Lamenting the US’ ballooning US$347 billion trade deficit with Asia’s biggest economy, Trump has accused China of economic “rape”. Accordingly, he has threatened to review China’s non-market economy status and its monetary policies for possible imposition of heavy tariffs and other sanctions under domestic and World Trade Organisation regulations.

To avoid a mutually destructive escalation, Beijing rightly reminded Washington that a big chunk of Chinese exports had value-added inputs from American companies.

Recognising the complexity of the issue, both sides agreed to a 100-day plan of marathon trade negotiations, which would allow the US to cut its trade deficit without undermining existing economic ties with China.

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In terms of geopolitics, North Korea topped the summit agenda, with Washington and allies such as Japan worried about Pyongyang’s burgeoning missile strength.

The Trump administration fears that North Korea is on the verge of acquiring the capacity to launch nuclear warheads as far as the US west coast.

With its strategic patience depleted, Washington is weighing pre-emptive action. The timing and circumstances of Trump’s military intervention in Syria was likely a calibrated move to telegraph Washington’s willingness to adopt a tougher stance on North Korea. Trump was also eager to show that he isn’t a paper tiger, a clownish leader bereft of resolve.

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Although perturbed by its prickly ally, China has a very different threat perception. It is more concerned about the fallout from a North Korean regime collapse, which could create a humanitarian crisis and a nuclear and biological proliferation catastrophe; not to mention, pave the way for the creation of a unified Korea allied to America.

As with trade, it is likely that China will ably split the difference on the North Korean issue by constricting Pyongyang’s financial lifeline, but fall short of completely suffocating the regime. In exchange for its concessions, China expects Trump to, at the very least, desist from any provocative move – whether it’s on trade, the South China Sea, the Korean peninsula or Taiwan – while China makes a sensitive domestic leadership transition.

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The two leaders did not hold a joint press conference or sign a joint communiqué, mainly due to the need for more detailed examination of areas of conflict and cooperation. But they did sound highly upbeat about the direction of their bilateral relationship. Xi lauded the two countries’ ability to “arrive at many common understandings” and “bear our great historical responsibility” to avoid great-power conflict and expand areas of Sino-American cooperation.

In turn, an affable Trump was optimistic over the prospects of “a very, very great relationship” with China, describing his personal relationship with Xi as “outstanding”.

In China, the US president seems to have met his match. Surely, some would hope that this could the start of a more mature and predictable Trump administration.

Richard Heydarian is a Manila-based academic and author