Alwaght- Recent meeting of the Chinese and American presidents amid heightened trade war carried rays of hope for a truce in the trade war of the two economic heavyweights, especially that remarks that followed their meeting bore signs of their optimism about a settlement. Commenting on the outcomes of meeting, US President Donald Trump said that "on the scale from 0 to 10, with 10 being the best, I would say the meeting was 12.". He added that they developed close views on many points.
In a statement, President Xi Jinping of China said the two countries “have a promising outlook for cooperation,” adding that relations between Beijing and Washington have “maintained overall stability” under his and Trump’s leadership. He noted that the two nations’ trade negotiation teams had “reached an initial consensus on addressing key concerns” during their recent meeting. “Both sides,” Xi said, “should take a long-term view and focus on the benefits of cooperation rather than getting trapped in a vicious cycle of retaliation.”
Despite Xi’s upbeat tone, an examination of the meeting’s outcome suggests that major issues in US-China trade relations remain unresolved, and optimism about the results may be premature.
Uncertainty in settling the issue of rare metals
Perhaps the most pressing issue in current US–China relations is Beijing’s ban on rare earth exports to the US. China controls nearly all global mining and processing of these critical materials, and the restriction has put Washington on edge. Rare earth elements are essential for military production and certain sectors of the semiconductor industry, making the ban a serious challenge for the US.
Trump said he raised the issue with Xi Jinping and that “they’re going to keep the process going.” Reports indicate the matter was discussed as part of a one-year agreement, but questions remain about what will happen to bilateral trade in rare earths once that year is over. Trump has claimed the rare earth dispute has been “fully resolved” and that “all obstacles have been removed,” yet he stopped short of clarifying whether China has agreed to extend the deal beyond the initial year.
China’s official statement, meanwhile, made no specific mention of rare earths. However, the Ministry of Commerce later announced that Beijing would suspend its export controls in exchange for Washington lifting its 50 percent tariffs. In effect, China’s ban on rare earth exports to the US has only been temporarily suspended, not permanently resolved.
Uncertainty around fentanyl
Commenting on the fentanyl, a chemical drug, the Chinese leader said that Beijing will do its best to make sure that flow of chemical material for making fentanyl will stop supply to the US.
Washington had previously imposed a 20 percent tariff on Chinese goods to pressure Beijing to curb the flow of fentanyl from China to the US. However, Trump announced that following his talks with Xi last Thursday, the tariff has been reduced to 10 percent in exchange for China’s commitment to halt the export of fentanyl to the US. China’s Ministry of Commerce confirmed the suspension of tariffs on fentanyl and several other products, saying it would adjust its reciprocal measures accordingly. Still, it remains unclear how China plans to prevent fentanyl exports to the United States. Fentanyl is a synthetic opioid that is roughly 100 times stronger than heroin and, in recent years, has become one of the leading causes of overdose deaths in the US and many other countries.
Continued ban on chips
The chips and their export to China remain a sticking point between China and the US. Trump said that he and Xi agreed on China buying Nvidia chips, but when he was asked if he gave a go ahead to exports of Nvidua's new generation of chips, Blackwell, that serve the AI, he said that "we're not talking about Blackwell." Blackwell B30A is a the latest product of The American chips giant that is planned to replace H20, something still banned for the Chinese.
No mention of Taiwan
The Taiwan issue remains one of the most prominent points of contention in US–China relations. Although Trump has said that he and Xi agreed to cooperate on moving forward regarding the war in Ukraine, the topic of Taiwan was left untouched during their talks. Speaking to reporters aboard his plane, Trump said that the issue of Taiwan “never” came up in his recent meeting with the Chinese president. This comes as Xi Jinping’s primary goal is to see Taiwan integrated as a province of China, while the United States remains Taiwan’s most important supporter against Chinese threats. Yet it appears that both sides have preferred silence over discussion on this issue, perhaps because they have both realized that no common ground can be found when it comes to Taiwan.
Further instability in relations
What can be understood from the discussions is that the current ceasefire in trade war is temporary and so their relations are expected to remain unstable. In such context, the two countries will very likely strengthen their military arsenals and prepare for next talks. At the same time, the recent agreements will give Beijing some space to breathe. The Chinese have sounded upbeat about trade war ceasefire in the next 12 months.
It seems that following the recent meetings between Chinese and US leaders, lower-level officials and advisors from both sides are now set to work out the details, while major decisions are expected to be made when the two presidents meet again in the coming months. The recent agreement, therefore, seems to serve merely as a framework for future talks.
China’s ability to leverage its dominance over rare earth elements has shifted the balance of power in its favor. The US, on the other hand, enjoys a technological advantage, one it is likely to use as a bargaining tool against Beijing. Yet China holds the upper hand in rare earth resources, which it uses as a strategic card in response to U.S. pressure. Over the past few years, the game board has gradually tilted toward Beijing, with China signaling if you want to play tough, we can play tough too.
Another issue is that Trump’s political clock is ticking much faster than that of the Chinese president. Because of the limited duration of his presidency, Trump has little time to secure concrete results in dealings with China. Xi, by contrast, enjoys the advantage of time, something allowing him to delay or stretch negotiations with the Washington under various pretexts. So, in talks with China, time is not in favor of Trump and Beijing is capable of playing a way longer game against the US president.
