The talks between both leaders, held at a military base in Busan, a port city in the south of the country, lasted just under two hours.
For Donald Trump, the meeting with Xi Jinping was the last stop (not to say the highlight) of a diplomatic tour of Asia that began last weekend. Note that the two leaders had not met since 2019. Since Donald Trump's return to the White House, they had only spoken once on the phone, on September 19. The purpose of that call was to finalize an agreement on the sale of TikTok's US operations.
A truce confirmed
Since then, tensions had escalated with Beijing's announcement in early October of new controls on rare earth exports. Donald Trump responded by threatening to impose 100% additional tariffs from November 1.
Finally, the de-escalation began over the weekend during a meeting between Chinese and American negotiators in Malaysia. Since then, signs of appeasement have already been visible. For example, the Chinese company Cofco yesterday announced that it had purchased three shipments of American soybeans. This comes after China, the largest buyer of American soybeans, had not placed any orders this year.
Today, the Americans and Chinese agreed on a number of measures. Beijing has agreed to suspend its controls on rare earth exports announced earlier this month for one year and to resume purchases of American soybeans. Meanwhile, Washington has decided not to expand the blacklist of Chinese companies with which American groups are prohibited from doing business.
The United States has also decided to reduce the tariffs imposed as part of the fight against fentanyl from 20% to 10%, with China committing to take measures to combat the export of precursors used by Mexican cartels to manufacture this synthetic drug. This brings US tariffs on Chinese products down from 57% to 47%.
The final element in this phase of warming Sino-American relations is Donald Trump's announcement that he will visit China in April, before welcoming Xi Jinping to the United States.
Irritants set aside
While the Busan meeting paved the way for de-escalation, many areas of friction were left unresolved. Starting with semiconductors, on which the US has imposed export restrictions since 2022. Earlier this week, Donald Trump hinted that he might discuss Nvidia's Blackwell chips (the most advanced) with Xi Jinping. On board Air Force One after the meeting, he said that the subject had not been discussed after all.
On semiconductors, the United States still seems to be wavering between two positions. On the one hand, China must be prevented from accessing advanced technologies (which can be used by the Chinese military, amongst others), as this is a matter of national security. This was the approach taken under Joe Biden.
On the other hand, there is a line of thinking, particularly pushed by tech bosses (led by Nvidia CEO Jensen Huang), which argues that the best way to counter China is to make it addicted to our technologies; rather than pushing China to invest in developing its own chips, we should allow exports so that American standards prevail. The Trump administration's back-and-forth on the issue shows that this debate is not completely settled.
Donald Trump and Xi Jinping did not dwell on international issues either. The question of China's purchases of Russian oil was not addressed, even though the US president imposed sanctions on Russian oil for the first time last week.
The issue of Taiwan was also not on the agenda. At the end of September, the Wall Street Journal reported that Beijing wanted Washington to clearly oppose Taiwan's independence, whereas the official position is currently that the US "does not support" independence.
This weekend, Secretary of State Marco Rubio closed that door by stating that the US would not conclude a trade agreement with China in exchange for concessions on Taiwan.
