A preliminary consensus, according to China, and a substantial framework agreement, according to the United States. An intense weekend in Malaysia has cleared the way for Xi JinpingChinese president, and Donald Trumphis American counterpart, seal the trade peace next week in South Korea after a turbulent year. The protagonists have assumed that Washington will lift the threat of 100% tariffs on Chinese products that were to come into force in November.
“I think that we will close an agreement with China“Trump has advanced in a jubilant day that began by sponsoring the peace between Thailand and Cambodia. The heavyweights of the two powers had met in Kuala Lumpur on Saturday. On the one hand, the Vice Premier He Lifeng and Trade Affairs Chief Li Chenggang; on the other, the Secretary of the Treasury, Scott Bessantand the representative of Commerce, Jamieson Greer. Optimism had spread this Sunday. Li has alluded to the preliminary consensus and described “some very intensive consultations and constructive exchanges shared to explore solutions and arrangements for those concerns.” “The “American position has been harsh”he has acknowledged.
Bessent has cited the substantial framework agreement and anticipated that next week China will open the rare earths tap again. In this favorable context, Trump advanced the next meeting schedule: after meeting in South Korea, he will visit Beijing after the Lunar New Year (in mid-February) and Xi will return the courtesy “in Washington or Mar-a-Lago.” Contrast the American enthusiasm with the China’s silencewhich has not even officially confirmed next week’s meeting. Beijing knows that any harmony with Trump can be broken.
Matters in check
A tough day awaits both of them this Thursday in Gyeongjiu, headquarters of the APEC (Asia Pacific Economic Cooperation forum) summit. From the bag of conflicts, Trump has advanced that he will begin with the fentanyl. The matter is seen in the opposite way. Washington maintains that Beijing has not made enough efforts to stop the trafficking of chemical precursors with which it is made, while China remembers that no shipment from its country has been found in the last year and that, in any case, there is no one more to blame for the pandemic than the demand for opiates created by the American pharmaceutical industry.
“President Trump gave me great pressure in the negotiations with the threat of 100% tariffs,” Bessent said in a television interview. Washington attributes this threat to Unlimited powers to pursue all your claims: cooperation in the lFight against fentanyl, flow of rare earths, Chinese purchase of US soybeans…The Chinese position has not been revealed but it is ruled out that it will give in in all these areas in exchange only for tariffs. Trump will also talk about Taiwana matter that Beijing unconditionally considers its own, and of Jimmy Laithe imprisoned Hong Kong press magnate.
Asian trade dominance
Trump has taken the opportunity to sign agreements with ASEAN members (Association of Southeast Asian Nations) that partly correct their past neglect. In his first term he barely attended one of the annual summits and even ignored the virtual edition during the pandemic.
His resignation, tariff attacks, visa restrictions and economic aid cuts have been used by China to erode the US footprint in an area with 680 million inhabitants and an economy of 3.8 trillion dollars. Beijing already leads influence in six of the eleven countries and in some (Malaysia, Burma, Laos or Cambodia) the United States does not even pose a battle, according to a report by the Lowy Institute.
The United States will maintain its tariffs of 19%, lower than the original, to Malaysia, Thailand and Cambodiaafter the agreements signed today. Some of them are related to rare earths, with which Washington wants to mitigate dependence on China. Kuala Lumpur will also give preference to the import of American industrial and agricultural products.
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