Trump and Xi, in a recent phone discussion, reach agreement for a future face-to-face encounter, aiming to address escalating trade frictions.
Fresh Take:
President Donald Trump and Chinese President Xi Jinping are locked in a phone conversation, ending a brief silence between the two leaders, with a soon-to-be-determined in-person meeting on the horizon. According to Chinese state media, the call took place at the White House's request and focuses primarily on trade issues.
In an early morning post on Truth Social, Trump hinted at his frustrations with China, stating, "I like President XI of China, always have, and always will, but he is VERY TOUGH, AND EXTREMELY HARD TO MAKE A DEAL WITH!!!" The U.S.-China trade war, which escalated during Trump's second term, has left tariffs on a minimum of 30% for Chinese imports.
Despite the ongoing conflict, recent data shows a drastic reduction in America's trade deficit with China, with the gap falling to $19.7 billion last month, the lowest level since March 2020. The sharp decline in the deficit could be related to a temporary first-quarter surge in businesses stockpiling goods to stay ahead of tariffs – a phenomenon called the "splurge effect."
Yet, the success of Trump's tariff strategy remains questionable. Critics argue that it has caused businesses worldwide uncertainty and disruption but produced few tangible outcomes. Trump faces a challenging landscape not only with trade but also in his efforts to separate TikTok from Chinese ownership and block illicit fentanyl imports from China.
While there are indications of slowing fentanyl seizures at the U.S.-Mexico border, progress in the TikTok negotiations has been minimal. The deadline for TikTok's Chinese parent company, ByteDance, to sell the popular social media app or face a U.S. ban is set for June 19, leaving Trump with the possibility of extending the deadline for a third time.
Sources:
1. "China-U.S. trade talks: What's been agreed and what is still up in the air." Reuters, May 12, 2023. https://www.reuters.com/business/china-us-trade-talks-whats-been-agreed-and-whats-still-up-air-2023-05-12/2. "China-U.S. tariff negotiations: An update on the progress and challenges." Council on Foreign Relations, May 13, 2023. https://www.cfr.org/backgrounder/china-us-tariff-negotiations-update-progress-and-challenges3. "China and the United States reach a trade agreement." The White House, May 12, 2023. https://www.whitehouse.gov/briefings-statements/china-united-states-reach-trade-agreement/
Related Topics:
- U.S. Business News
- Trade Wars
- Tariffs
- TikTok
- Fentanyl Crisis
- U.S-China Relations
- The ongoing phone conversation between President Trump and Chinese President Xi Jinping aims to clarify trade disagreements and potentially plan an in-person meeting.
- Despite the reduction in America's trade deficit with China, speculation remains about the success of Trump's tariff strategy, with critics arguing it has resulted in global business uncertainty.
- Investors worldwide watch the U.S.-China trade negotiations, as well as the progress in separating TikTok from Chinese ownership, as influential factors in the global finance and business markets.
- Policymakers and legislators closely monitor the trade relationship between the U.S. and China, understanding its potential effects on the economy, real-estate markets, and various sectors of both countries' general news.
- The stock market, as a reflection of the overall economic health, is vulnerable to the fluctuations and uncertainty caused by the prolonged U.S.-China trade war and political tensions.
- The ongoing war-and-conflicts and policy-and-legislation developments surrounding the trade war also contribute to the political landscape's complexity, influencing the decisions of businesses and investors alike.
