Xi Jinping-Donald Trump meeting at G20 is good news, but trade war and its damage will linger, US business leaders predict

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.”