Opinion | How many personal truces between Xi and Trump will it take to resolve the trade war?
- Presidents used their close friendship to get the stalled talks back on track but nothing really changed in Osaka, Ankit Panda says
How many times can Chinese President Xi Jinping and US President Donald Trump agree to a personal truce before things turn sour again? At their meeting on the sidelines of the Group of 20 summit in Osaka, the two men agreed to a resumption of the stalled trade negotiations but failed to come to any kind of grand bargain or deal.
To create a better environment for the talks, Trump agreed not to go ahead with his threat to impose new tariffs on about US$300 billion worth of Chinese imports, but details of what else was agreed in Japan remain elusive. The meeting did, however, represent a watershed moment in the progression of the trade war.
The outcome won’t delight global markets but it should prevent a major reversal of the slowly improving sentiment since May. Though after their 80-minute meeting – held exactly seven days before the 12-month anniversary of the start of the trade war on July 6 – Trump and Xi are no closer to settling it.
One of the most important outcomes of the G20 encounter concerns the fate of Chinese tech giant Huawei. Trump has taken a conciliatory approach, allowing the sale of US components to continue while reviewing the export control measures that had been announced some weeks earlier.
For Xi, as was the case with ZTE in 2017, the Huawei outcome is an important one. The United States’ national security concerns over the company haven’t evaporated and the company’s chief financial officer Meng Wanzhou’s extradition is still pending, but broader concerns that American export restrictions would stamp out Huawei’s ability to survive in the hardware space in the short-term will be eased.
Insofar as the United States is interested in bringing about a change in Chinese behaviour, the action against Huawei was a major source of leverage. Trump’s commitment to Xi to back off on Huawei – at least on export controls – will allow for a certain level of confidence to return to the talks, but it also weakens the American position.
