WHAT HAPPENS NEXT?
For commerce talks to advance, Mr Trump and Mr Xi will should be actively concerned in defining the parameters of a remaining deal. Mr Trump has steered he could quickly communicate with Mr Xi by cellphone, which may lend credence to the best-case state of affairs of each side working in the direction of a complete commerce settlement.
Questions come up about how China is ready to divulge heart’s contents to American companies, as Mr Trump claimed, and the way the US is ready to reciprocate.
From China’s perspective, there are a number of steps it will possibly take to cut back commerce imbalances, a significant supply of stress between the 2 international locations.
First, Beijing is able to considerably enhance purchases of American agricultural merchandise and vitality to cut back the commerce deficit. Second, it will possibly take measures to restrict exports to the US, a pattern already rising as exporters diversify into different markets. Third, Beijing can proceed to extend its holdings of US Treasury securities – China is the second-largest holder, with US$784 billion, after Japan. Fourth, Beijing can encourage extra Chinese language firms to put money into the US.
Nonetheless, many questions stay. What concessions can the US supply China in return?
Can the US calm down controls over high-tech merchandise, together with semiconductors? Even when Chinese language firms want to put money into the US, will they be welcomed at a time when even Chinese language-produced garlic is deemed a nationwide safety menace?
Discovering solutions to those questions is not going to be simple.
Wang Xiangwei is a former Editor-In-Chief of South China Morning Submit. He now teaches journalism at Hong Kong Baptist College.
