Drew Thompson

Opinion | As trade war frustrations mount in the G20, Trump and Xi still have a mountain to climb to deal with the thorny issues

Fears are growing of a global recession as the world’s two largest economies remain deadlocked, with neither side seemingly willing to compromise

Xi appears to have little support in Beijing for structural changes, while Trump’s team insists reform of the Chinese economy is the only acceptable outcome

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Drew Thompson

Published: 1:00am, 25 Jun 2019Updated: 5:43am, 25 Jun 2019

The Trump-Xi meeting will be the most watched side meeting at the G20 summit in Osaka at the end of the month. It will be their first face-to-face meeting since the last Group of 20 summit in Buenos Aires, in December 2018.

US President Donald Trump and Chinese President Xi Jinping will have plenty to talk about but, unfortunately, it is unlikely that their summit will resolve the host of thorny issues confronting the bilateral relationship.

US-China trade friction is at the top of the agenda, and a major point of concern for all other G20 members. A major fear is that a protracted conflict will depress the world’s two biggest economies, affecting global growth and even causing a global recession.

There is growing frustration among other G20 members at both Beijing’s refusal to address the industrial policy issues at the heart of the dispute – non-tariff barriers, subsidies to state-owned enterprises and national champions, and intellectual property theft – and the Trump administration’s unilateral approach, including the liberal use of tariffs.

The gap between the US and China remains wide, and there are no indications China is prepared to compromise. In fact, after Trump’s patience ran out in May because of what he felt was the Chinese side backtracking on previously agreed-upon language in the joint agreement,