The meeting between US President Donald Trump and Chinese President Xi Jinping at the G20 summit next week in Osaka, Japan, is cause for optimism that trade tensions between the world’s two largest economies will start to ease – but US business leaders do not expect a quick end to US tariffs and Chinese retaliation. Nor do they believe the Trump administration’s use of tariffs is the best way to resolve the trade impasse, according to remarks at a panel discussion in Washington jointly hosted by the Centre for Strategic and International Studies and the Japan External Trade Organisation. “I think we’ll see some market calming statement and a return to negotiations. So you’ll see something, I would assume, something similar to Buenos Aires, than anything else,” said Charles Freeman, the senior vice-president for Asia at the US Chamber of Commerce, referring to a short-lived truce in the trade dispute after a Trump-Xi meeting in the South American nation on December 1. Negotiations broke down in May when the Trump administration accused China of backtracking on commitments and increased tariffs to 25 per cent on US$200 billion worth of goods. Trump continues to threaten to put additional tariffs on another US$300 billion or so of Chinese imports. “The notion that we’ll get a comprehensive agreement any time before the end of this year is doubtful to me,” Freeman said. “And then the question from my mind becomes, do the Chinese start looking at the political calendar here and saying maybe it would be easier to deal with a Pete Buttigieg, or whomever, than a Donald Trump? Which I think would be dangerous, but that is a separate conversation.” Trump officially launched his 2020 re-election campaign in Florida on Tuesday night. He will face one of more than 20 Democratic challengers from a field that includes Buttigieg and former US vice-president Joe Biden, who leads in polling. Trump’s imposition of duties drew retaliatory measures by the Chinese, including tariffs and a severe reduction in its purchases of US agricultural goods such as soybeans. China represents a major export market for US farmers, whose loss will only compound an especially poor planting season given extensive rain and flooding. Will US farmers miss out on their ‘greatest sales opportunity’ in China? Decades and billions of US dollars spent by farmers to open their access to the Chinese market could be at risk if Beijing decides that non-US producers can provide them with a reliable source of grains and other agricultural products. “I think a good outcome for us, from an agricultural standpoint, would be to see resumed market access to China. It was our top export market,” said another panellist, Lorraine Hawley, senior director of international government relations at food processing giant Archer Daniels Midland. “So we are hopeful and believe that there will be a positive outcome at some point. It may not be this year, it may be later than that, but we do believe both governments want to see a resolution here. Our trade relationship is just too important to let things go for very long.” Hawley said China’s retaliatory tariffs targeting the US agriculture industry “are a challenge”, especially when the focus in the current negotiations was seeking safeguards for US technology and limiting the transfer of American intellectual property to the Chinese, something Washington and the technology community have railed against for years. But she said the tactic of using tariffs was what farmers believed brought Beijing to the negotiating table. “Any ratcheting down of the tensions is really important. We do as an industry have serious concerns with some policies within China that make market access difficult,” said Aaron Cooper, vice-president for global policy at the Software Alliance, which represents some of the world’s largest computer software companies. It was founded by Microsoft in 1988. “We think tariffs are not helping the situation … And even if it is not a comprehensive deal, at least [if both sides] start moving in the direction of trying to limit some of the market access barriers and also try to relieve some of the pressure that is coming from the tariffs, I think would be a positive outcome,” he said. Hundreds of firms descend on Washington to fight Trump’s China tariffs The use of tariffs, which Trump has hailed as a “beautiful” negotiating tactic, was not in the best interests of their respective groups, the panellists said. “It comes down to, in many cases, the right diagnosis of the challenge but the wrong prescription,” Freeman said of the need to address trade imbalances the US has with China as well as the rest of the world. “We are not tariff guys at the chamber. We don’t think it is helpful … The tariff approach has really been very damaging, across the board, to our membership.” Sign up to our China at a Glance newsletter and you'll receive an exclusive 3-day G20 news package in collaboration with POLITICO (coverage from 28-30 June)