Donald Trump came away from his meeting with Chinese leader Xi Jinping full of bombastic optimism. He called it a great success and rated it 12, on a scale of 1 to 10. China was less enthusiastic. Beijing's initial statement sounded like an instruction manual, with Xi urging teams on both sides to follow up as soon as possible.
Trump is after a deal that could happen pretty soon, while Beijing, it appears, wants to keep talking because it's playing the long game.
There was a more detailed second Chinese statement that echoed what Trump had said on board Air Force One. Among other things, the US would lower tariffs on Chinese imports, and China would suspend controls on the export of rare earths, critical minerals without which one cannot make smartphones, electric cars, and, perhaps more crucially, military equipment.
There is no deal yet, and negotiators on both sides have been talking for months to iron out the details. But Thursday's agreement is still a breakthrough. It steadies what has become a rocky relationship between the world's two biggest economies and assures global markets.
But it is only a temporary truce. It doesn't solve the differences at the heart of such a competitive relationship. The US and China are going in different directions, says Kelly Ann Shaw who was an economic advisor to President Trump in his first term.
The meeting demonstrated the art of negotiation with Trump, which Xi seemed to negotiate skillfully. Unlike Trump, Xi does not need to worry about elections or a concerned voter base. However, he does face internal pressures as he needs continued economic growth to maintain the Communist Party's stability.
Both leaders are taking lessons from the ongoing economic tug-of-war, with Xi adapting a strategy that keeps China’s long-term objectives in sight while managing the current trade war implications for both sides.
Despite shared challenges like a real estate crisis and rising unemployment in China, experts argue that China has demonstrated resilience against US tariffs and is willing to endure short-term pain for long-term gain.
As the US grapples with its strategy, the upcoming months could see barriers intensifying again, building a landscape of ongoing rivalry that may shape global economic dynamics.
