President Trump agreed to cancel planned Jan. 1 increases in the tariffs on Chinese products during a dinner meeting with Chinese President Xi Jinping on Saturday, in return for what the White House called purchases of a “very substantial” amount of American farm, energy and industrial goods.
The limited bargain will also see the United States and China restart talks aimed at resolving a trade dispute that is damaging the global economy, worrying some of Trump’s Republican allies and unnerving investors.
The two leaders struck the bargain during a roughly 2½ -hour dinner meeting on the sidelines of the summit of G-20 leaders that saw them personally engage on several of the greatest irritants in the U.S.-China relationship.
The two sides agreed to “immediately” begin talks on Chinese industrial policies, including coercive licensing of U.S. technology, trade secret theft and nontariff trade barriers.
“This was an amazing and productive meeting with unlimited possibilities for both the United States and China,” Trump said in a statement issued from Air Force One as he returned to Washington. “It is my great honor to be working with President Xi.”
But their partial accord left the toughest issues to future bargaining sessions that will attempt to succeed where earlier efforts failed — and under an ambitious 90-day deadline.
Some administration supporters said the talks had made important progress on issues such as cooperation in opposition to the North Korean nuclear program and restricting illicit shipments of the addictive opioid fentanyl, but did not represent a breakthrough in commercial diplomacy.
“On standard trade issues, this is where we were weeks ago,” said Derek Scissors, a China scholar at the American Enterprise Institute and sometimes adviser to the administration.
While the Trump-Xi duet riveted most attendees here, the G-20 leaders agreed on a communique that reflected shared ambitions in economic development, finance and trade.
The communique was in harmony with “many of the United States’ biggest objectives,” especially in backing reform of the World Trade Organization, according to a senior administration official who briefed reporters on the condition of anonymity.
On climate change, however, the United States remained the lone holdout, with 19 other leaders pledging to implement the Paris accord to fight global warming. The United States instead reiterated Trump’s decision to withdraw from the accord.
G-20 leaders also agreed that the global trading system “is currently falling short of its objectives” and agreed to take stock of proposed overhauls at next year’s summit in Japan.
But it was the United States and China that dominated the spotlight.
Perhaps not since President Richard Nixon met Chinese leader Mao Zedong in 1972 have U.S.-China relations pivoted so closely around individual personalities, Aaron Friedberg, a China specialist at Princeton University, said.
“Both men have cast themselves as ‘maximum leaders,’ strong men defending the interests and honor of their nations,” Friedberg, a former foreign policy adviser to Vice President Richard B. Cheney, said via email. “Neither wants to appear weak, which would seem to narrow the scope for compromise, but neither wants to be blamed for a complete breakdown in relations.”
Since becoming general secretary of the Communist Party in 2012, Xi has spoken of leading “the great rejuvenation of the Chinese nation.” He has lavished funds on the Chinese military and asserted control over the South China Sea via an unprecedented island-building campaign.
Xi also has presided over an increasingly aggressive campaign to pilfer American technology to fuel China’s economic rise, according to the Trump administration.
[Trump and Xi’s G-20 meeting offers best chance of defusing trade fight]
Trump and Xi met in April 2017 at the president’s Florida estate, Mar-a-Lago, and in Beijing in November 2017. After negotiations led by their subordinates ran aground, Trump telephoned Xi last month to reopen the dialogue.
The trade conflict, which has rattled financial markets and upended global supply chains, began this year when Trump imposed tariffs on $253 billion of imported Chinese steel, industrial products and consumer goods, including handbags, furniture and appliances. Chinese officials, caught off guard by the aggressive U.S. moves, retaliated with import taxes on such American products as soybeans, automobiles and liquefied natural gas.
The Trump administration complains that China treats American companies unfairly in defiance of its obligations as a member of the World Trade Organization. In March, U.S. Trade Representative Robert E. Lighthizer blistered China in a 215-page report accusing it of a comprehensive campaign to acquire and steal advanced U.S. technologies.
By generously subsidizing its state-owned enterprises and coercing American companies to surrender their trade secrets in return for access to the lucrative Chinese market, Beijing seeks to dominate the industries of the future, said Lighthizer.
Despite Trump’s tariffs and months of escalating U.S. complaints, China “has not fundamentally altered its unfair, unreasonable, and market-distorting practices,” Lighthizer said last month.
In recent weeks, officials at multiple levels of the two governments sought to develop a deal to avert additional U.S. tariffs while reinvigorated negotiations over a broader pact began.
Trump and Xi met amid mounting worries that trade fights are undermining a weakening global economy. Christine Lagarde, managing director of the International Monetary Fund, said Saturday that “trade tensions have begun to have a negative effect” and are increasing the risk that growth will disappoint.
By David J. Lynch