whose Kentucky farm this masthead visited in April<\/a>, praised the agreement as \u201ca meaningful step forward to re-establishing a stable, long-term trading relationship\u201d.<\/p>\nTrump himself rated the meeting a \u201c12\u201d out of 10, and agreed to cut US tariffs by 10 per cent, from a putative total of 57 per cent to 47 per cent.<\/p>\n
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Caleb Ragland runs Magnolia Grain and Stock in Magnolia, Kentucky. He produces soybeans, mostly for export to China.Credit: Luke Franke<\/p>\n
But experts say that behind the flashy headlines and photographs, this d\u00e9tente has come at a hefty price. Xi would be emboldened by the outcome, says Julian Gewirtz, who was the senior director on China and Taiwan affairs on Joe Biden\u2019s National Security Council, and is now a scholar at Columbia University.<\/p>\n
\u201cThe meeting between President Trump and President Xi has been widely interpreted as a return to the status quo, but unfortunately for the US it\u2019s worse than that,\u201d he says. \u201cThe reality is that although some of the recent escalation has been put on pause, China has still put its significant new weapons on the table. And while it has said it will not use them for a year, we know that the possibility of this temporary truce not holding for a year is all too high.\u201d<\/p>\n
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The meeting was heralded for cooling the trade war between the world\u2019s two largest economies.Credit: AP<\/p>\n
While the meeting was not as bad as it could have been, Gerwitz says, \u201cmuch of the world will be reinforced in their view that China is winning this standoff between the United States and China, and that the US has not demonstrated that it has a coherent China strategy\u201d.<\/p>\n
Trump\u2019s strategy with Beijing – as with the rest of the world – has effectively been to bet that the size and power of the US market is so great that other countries will be forced to cave to American demands to avoid tariffs and keep selling as cheaply as possible to the American consumer.<\/p>\n
It has, by and large, worked. Even if many of Trump\u2019s \u201cdeals\u201d around the world have involved vague, long-term investment pledges – or repackaging existing endeavours as fresh commitments – world leaders have generally been anxious to ink a deal with Trump and claim a win to their own constituencies, just as Trump does.<\/p>\n
Even Australia played this game by relaxing rules about the import of US beef products, and a critical minerals deal signed at the White House last week.<\/p>\n
But in China, Trump faces a great power with comparable – perhaps even greater – leverage. As the gatekeeper in charge of 90 per cent of the world\u2019s critical mineral processing, Beijing knows it \u201cholds the cards\u201d, to use one of Trump\u2019s favourite expressions. The rapid demise of his 145 per cent tariff on Chinese goods earlier this year, which he quickly admitted was unsustainable, stands as testament to that reality.<\/p>\n
One of Trump\u2019s apparent achievements in Busan was a one-year delay to sweeping restrictions on rare earth exports announced by China in the lead-up to the meeting, which most analysts viewed as a bargaining chip. Wendy Cutler, senior vice president at the Asia Society Policy Institute in Washington, said Beijing will likely keep using the threat as \u201ca hammer over the US\u2019s head\u201d, making Trump\u2019s tariffs threats less credible.<\/p>\n
\u201cThe announced outcomes do little to resolve underlying structural issues that are at the heart of our bilateral economic tensions, including excess capacity, excessive subsidies, and unfair trade practices. As such, this truce may be short-lived,\u201d Cutler said.<\/p>\n
\u201cUnlike the \u2018phase one\u2019 trade agreement concluded during Trump\u2019s first term, this time around Beijing drove a hard bargain insisting on getting paid for every concession it made, particularly regarding reducing tariffs and unwinding shipping fees.<\/p>\n
\u201cThis is in sharp contrast to the other trade agreements that Trump has concluded in recent days, which were heavily tilted in the US\u2019s favour. Trump has met his match with China, which has shown that two can play at this game.\u201d<\/p>\n
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Trump has enjoyed a positive run on the international stage. Back home, he may soon preside over the longest government shutdown in US history.Credit: AP<\/p>\n
Trump intends to head to China for another Xi meeting in April, and welcome the Chinese leader to the US at some point after that. He remains confident of cutting a final trade deal.<\/p>\n
For Australia, the Trump-Xi encounter – as well as from Albanese\u2019s successful meeting last week – should expel any notion that Trump is a China \u201chawk\u201d who will look poorly on Canberra for cultivating a better relationship with Beijing.<\/p>\n
Gewirtz says there is a lingering view among some in Washington that because the first Trump administration helped foster a bipartisan appreciation of China\u2019s threats to American interests – such as its military buildup, technological prowess and stranglehold on rare earths – the second Trump term would continue in that vein.<\/p>\n
But it has been markedly different, in part because – as the Asia Group\u2019s Mira Rapp-Hooper wrote in the journal Foreign Affairs this week – policy is no longer being co-ordinated by a whole-of-government approach led by the National Security Council but by a small coterie headed by Trump.<\/p>\n
\u201cThe reality is that in this term, across the board, Trump has done what he said he was going to do, [including] pursue a \u2018big, beautiful deal\u2019 with China. And he has made clear again and again over the course of 2025 that a deal is his priority,\u201d Gewirtz says.<\/p>\n
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Donald Trump boards Air Force One on his way to Washington, DC, after his meeting with Xi Jinping in Busan.Credit: AP<\/p>\n
\u201cFrom Beijing\u2019s perspective, they\u2019ve seen this show before and are, I think, girding themselves for whatever point this truce ceases to be the order of the day.\u201d<\/p>\n
Loading<\/p>\n
That day may come sooner rather than later. Trump\u2019s dealings with China are, like his presidency writ large, characterised by sudden, severe changes of heart. This is likely to be, in wartime parlance, a ceasefire, not a permanent peace.<\/p>\n
Get a note directly from our foreign correspondents on what\u2019s making headlines around the world. Sign up for our weekly What in the World newsletter<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"Normal text sizeLarger text sizeVery large text size New York: Pictorially, Donald Trump had a blockbuster 24 hours.…\n","protected":false},"author":2,"featured_media":254122,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[64,63,99,164],"class_list":["post-254121","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-au","tag-australia","tag-business","tag-economy"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/254121","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=254121"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/254121\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/254122"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=254121"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=254121"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=254121"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
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