AUSTIN/BUSAN/SINGAPORE: US President Donald Trump said his meeting on Thursday (Oct 30) with his Chinese counterpart Xi Jinping was “amazing” and that both sides had reached a trade deal on rare earths, soybeans and tariffs on chemicals for the drug Fentanyl.
In comments after their widely anticipated meeting in the South Korean port city of Busan, Trump said his meeting with Xi was a 12 on scale of 1 to 10.
Effective immediately, the US would reduce Fentanyl tariffs to 10 per cent from 20 per cent, while China would restart soybean purchases immediately, too.
Trump told reporters aboard Air Force One that all the rare earths issues have been settled, with no more roadblocks. He said it is a one-year agreement that will be extended.
China dominates the global trade in rare earth mining and processing and the materials are vital for defence equipment, semiconductors and other electronics. Recent restrictions on rare earth exports by China had infuriated the Trump administration, triggering a threat to add 100 per cent tariffs on Chinese goods exported to the US by Nov 1.
More details of what was agreed in Busan are due to be released, following the meeting that lasted one hour and 40 minutes. China has not yet officially commented on the outcomes.
Earlier, both men were all smiles in front of the cameras before the talks got under way.
“It’s a pleasure to see you again,” Xi said as he shook Trump’s hand in front of the media. “Good to see you again,” Trump replied.
The first meeting of the two leaders since Trump’s return to the White House is an attempt to calm the waters in the middle of a trade war between the two biggest economies in the world.
The hope is that the talks may result in a lowering of the high trade barriers they have imposed on each other in 2025.
“We’re going to have a very successful meeting, I have no doubt,” Trump said.
“But he’s a very tough negotiator and that’s not good,” he added as he patted Xi on the back. “We know each other well.”
A trade deal with China could be made at the meeting, Trump said before the two men then left the stage to begin their talks.
A statement from the Chinese Ministry of Foreign Affairs said Xi had told Trump that it was important that the relationship stayed on course.
“You and I are at the helm of China-US relations,” Xi said.
“In the face of winds, waves and challenges, we should stay the right course, navigate through the complex landscape, and ensure the steady sailing forward of the giant ship of China-US relations.”
“Given our different national conditions, we do not always see eye to eye with each other. And it is normal for the two leading economies of the world to have friction now and then,” he added.
The high-stakes encounter has special significance for South-East Asia. If Trump lowers tariffs on China, this would leave the region’s exporters competing with the world’s largest manufacturer for the American market.
“Very much looking forward to my meeting with President Xi of China,” Trump wrote in a Truth Social post hours before the meeting, from Gyeongju in South Korea where he spent the last night of his five-day trip to Asia that also took him to Malaysia and Japan.
An Oct 29 statement from the Chinese Foreign Ministry said the leaders would have “in-depth communication on strategic and long-term issues concerning China-US relations, as well as major issues of mutual concern”.
Originally scheduled to last about two hours, the closed-door meeting took place about 80km from Gyeongju, where 21 leaders from Asia-Pacific Economic Cooperation (Apec) grouping are gathered to make a case for free trade at their summit.
Given the deal-making US President’s penchant for the dramatic, there was some expectation that the talks would last longer.
And, sure enough, Trump managed to grab eyeballs with another social media post just an hour before the delegations met.
He announced that he would direct the Pentagon to begin testing nuclear weapons “on an equal basis” with Russia and China.
No other details were revealed but it was a reversal of decades of moratorium on testing. The last nuclear weapon test in the US was held in 1992.
Han Lin, China managing director for The Asia Group, a Washington, DC strategic advisory group, called it typical of Trump – bold and disruptive.
“He’s forcing the room to focus on US leverage amid the smiles! If it lands a trade win, it’s genius; if it poisons the well, I guess we’re in for frostier summits ahead. Quite an opening!” Han said.
At an Oct 29 dinner with Apec leaders, Trump was caught in a “hot mic” moment, overheard saying that the meeting with Xi would be “three, four hours” and he would then go home to Washington.
One outcome could be a smallish deal, with China agreeing to defer its expansive restrictions on the export of rare earths in exchange for the US taking down its threat of additional 100 per cent tariffs on Chinese goods that would have amounted to a trade embargo if implemented on Nov 1.
This would dial back the tensions for now, with expectations of more concrete achievements to come from Trump’s planned visit to China early in 2026.
A deeper, sweeter deal would see China tighten the reins on the production and export of precursor chemicals used to make the synthetic drug fentanyl, which is responsible for killing thousands of mainly white, working-age American males every year.
Beijing could also agree to resume its purchase of soya beans from American farmers, which it had halted amid the tariff war.
A third key concession that would please Trump would be Xi’s approval of the sale of Chinese firm ByteDance’s majority stake in TikTok, which is the most popular social media app among young Americans.
All three concessions would be popular with Trump’s key political constituencies and further his Republican Party’s prospects in 2026’s midterm congressional elections. The US stock market has been climbing on the hopes of a trade framework coming out of the meeting.
The US, in turn, will likely suspend the 20 per cent tariffs imposed because of China’s alleged role in the surge of fentanyl in the US.
But the bigger get for Beijing would be if Washington walked back current and proposed export controls on high-tech wares, including the possibility of letting China buy a version of the advanced Blackwell semiconductor artificial intelligence chips designed by Nvidia.
One of the more contentious issues on the table is China’s reported keenness that the US cut back its support for Taiwan, a self-ruled island that Beijing considers its own. Taiwan will be closely watching the meeting for signals of a pullback of American support.
The fears are not unfounded, with Trump downgrading diplomatic engagements with Taiwan during his second term, and blocking the sale of a major arms package to it.
The US President has said he does not believe China would invade Taiwan during his presidency, creating uncertainty over his commitment to bolstering the island’s defences.
The talks offer Xi a chance to brandish China’s strength with the US at a time when the Chinese economy is shrouded by prospects of deflation and capital flight.
For the region, the US-China thaw could bring mixed blessings.
Lower tariffs on goods from China could pit it as a rival in South-East Asia’s own trade with the US. The average tariffs on Chinese goods arriving in the US are estimated to be at about 57 per cent, according to the Peterson Institute for International Economics.
Against this, exports to the US from South-east Asian nations face tariffs of about 19 per cent. Goods from Singapore, as a result of a 2003 free trade pact with the US, face a lower tariff of 10 per cent.
Regional states have it tough both ways, said Gregory Poling, who directs the Southeast Asia Programme at the Centre for Strategic and International Studies.
“If the meeting goes poorly and the two sides deepen the trade war, it’ll further damage economic growth for everyone,” he said.
“But if they make some kind of grand bargain, it could advantage Chinese exports over those from South-East Asia or sacrifice other regional interests.”
Observers are also watching to see if a thaw results in both the US and China stopping pressure on the region to pick sides.
Poling said that aspect is unlikely to change, no matter the outcome of the Trump-Xi summit.
“Most countries will try and keep up engagement with both while looking to Europe, the Gulf and elsewhere for long-term diversification,” he said.
“Both Beijing and Washington are now dangerous.”
The total goods trade between the US and China was an estimated US$582 billion in 2024. This included goods worth US$439 billion imported from China and goods exported to China valued at US$143 billion.
In the US, wariness has only grown over the decade about China’s bulging manufacturing muscle and the threat it poses to American supremacy.
But the bipartisan consensus over viewing China as a somewhat unscrupulous competitor has shown the first signs of fraying.
Ahead of the Trump-Xi summit at Gimhae airport in Busan, a small group of protestors who had hung American flags on their vehicles and shouting anti-Chinese slogans through loudspeakers were quickly quelled by the police. Three people were detained for causing disturbance.
Local media also reported that there was a group from the Chinese community who were present to welcome Xi’s arrival, while a separate group of conservatives were there to send off Trump.
In South Korea, the right-leaning conservatives are traditionally pro-American and supportive of the two countries’ alliance.
On Oct 29, both anti-Trump and anti-Chinese rallies had taken place at separate locations in Gyeongju, where the annual Apec summit is being held.
A new poll by the Chicago Council on Global Affairs has shown that Republicans and Democrats have opposing views on China.
It says that Republicans favour decoupling from China, and want containment over cooperation. By contrast, Democrats don’t see China as a top threat, oppose decoupling, and favour cooperation over containment, “especially on issues of common concern like arms control and climate change”.
Older polls, such as the one by Pew Research Centre in 2024, have shown that eight in 10 Americans have an unfavourable view of China.
Such sentiments leave open the question of how durable a US-China trade truce can be. - The Straits Times/ANN
