• Trump’s Diplomatic Successes in Asia

By Shashi P.B.B. Malla

China gains the upper hand

In the final leg of his Asian diplomatic mission, US President Donald J. Trump described his face-to-face summit with Chinese leader X Jinping last Thursday as a fantastic success (AP/Associated Press, Oct. 30).

Trump said he would cut tariffs on China, while Beijing had agreed to allow the export of rare earth elements and start buying American soya beans, the export of which had been held up for months.

The president told reporters aboard Air Force One that the U.S. would lower tariffs implemented earlier this year as punishment on China for its selling of chemicals used to make the opioid fentanyl from 20 % percent to 10 % percent.

That brings the total combined tariff rate on China down from 57 % percent to 47 % percent.

“I guess on the scale from 0 to 10, with ten being the best, I would say the meeting was a 12,” he boasted in typical Trump fashion. “I think it was a 12”.

In the meantime, Trump’s domestic governance was a complete mess. The complete government shutdown was already a month old. In their supreme arrogance, Trump and the Republicans were in no mood to negotiate with the Democrats.

Treasury Secretary [Finance Minister] Scott Besant said China agreed to purchase 25 million metric tons of US soya beans for the next three years, starting with 12 million metric tons from now to January.

China is a huge market for US soya beans, and as a significant bargaining chip/pressure point, Xi had ordered an abrupt standstill in exports to the US.

As with the rare earths, the US had to yield to Chinese pressure, but Bessent put a spin to the ‘successful’ negotiation: “So you know, our great soya bean farmers, who the Chinese used as political pawns, that’s off the table, and they should prosper in the years to come,” Bessent boasted to Fox Business Network.

Trump said that he would go to China in April 2026 and Xi would come to the U.S. “Some time after that.”

The president said they also discussed the export of more advanced computer chips to China, saying that Nvidia would be in talks with Chinese officials.

Trump also said he could sign a trade deal with China “pretty soon.”

Xi was very reasonable in saying Beijing and Washington would work to finalize their agreement to provide “peace of mind” to both countries and the rest of the world.

“Both sides should take the long-term perspective into account, focussing on the benefits of cooperation rather than falling into a vicious cycle of mutual retaliation, Xi stressed.

America has lost the trade battle

One of The New York Times’ most prominent columnists, Nicholas Kristof writes that Trump “started a trade war that Washington has been losing, and a truce that was formalized in the past few days is one with China holding power over America and leaving its power diminished” (Nov. 1-2).

Kristof also writes that the most important bilateral relationship in the world today is between the United States and China, and Trump has bungled it totally.

Of course, after the US-China summit in South Korea summit, Trump is boasting about his deal-making skills.

Back in April, when Trump rashly announced his “Liberation Day” tariffs, he badly miscalculated.

He and his aides thought that China was vulnerable because it exported more to the United States than it purchased.

First, they made the cardinal mistake of not realizing that much of what China imported from the U.S., like soybeans, it could also purchase elsewhere, like from Brazil and Argentina.

Second, these smart people forgot to consider in the export-import equation that China controls about 90 % percent of rare earths and is the sole supplier of six heavy rare earth minerals; it also dominates rare earth magnets.

Rare earths and rare earth magnets are essential ingredients of modern advanced industry.

They are necessary for the manufacturing of today’s drones, automobiles, airplanes, wind turbines, most electronics and much military equipment.

Without them, some American factories would have to close and military suppliers would be severely affected.

A single submarine can require four tons of rare earths!

It was to be expected that China would respond to an international dispute by weaponizing its control over rare earths, for that is what it did with Japan in 2010.

Sure enough, two days after Trump announced his Liberation Day tariffs, China was well prepared and itself announced export controls for some rare earths. It then greatly expanded the export controls this month.

It also became clear that on the American side rank amateurs with no historical knowledge were at work – and lacking diplomatic finesse.

It soon became obvious that President Xi Jinping had a major advantage in the ongoing trade war, for the U.S. economy depends on Chinese rare earths far more than China depends on American soybeans.

The latest bilateral deal might look like a return to the status quo, but Kristof is of the opinion that it’s more like the U.S. surrendering and ending up in a weaker position after a conflict it started.

Moreover, a one-year suspension of export controls on rare earths would be a brilliant move by Xi, allowing Beijing to retain its leverage over the United States without causing much disruption.

Kristof writes that an overwhelming number of international relations experts said that China was winning and now holds the advantage.

In fact, Xi has given notice that the Trump administration is expected to be in its best behaviour in the trade sector since it does not have any rapid way of finding sources of rare earths.

Kristof is very blunt: “The trade bully unexpectedly found himself bullied, so he began to court China and make concessions.”

Trump:

  • Dialled back tariffs
  • Eased rules on exporting advanced microchips to China
  • Allowed TikTok to continue to operate in the U.S., despite serious national security concerns
  • Blocked a visit to the U.S. by Taiwan’s president and reportedly delayed an arms sale to the autonomous island nation.

As the Center for American Progress put it, “the Trump administration’s approach to China is in strategic free fall.”

This is also about what worries foreign policy pundits in the coming years.

Xi has already recognized America’s weakness.

He has established that he has the upper hand in the bilateral relationship and that Trump is the weaker actor who will buckle under pressure, including on security matters.

And, according to Kristof, since Trump has betrayed and antagonized allies, they are less likely to work with the U.S. in resisting Beijing. 

In fairness, Xi is simply doing to the United States what it has done to China. It is simply a fact of quid pro quo.

A one-year suspension of rare earth licensing is after all simply a way of reminding American leaders – and others around the world, for the restrictions were global – of their vulnerability.

The aim definitely would be to induce more compliant behaviour on issues Beijing cares about, from Taiwan to human rights complaints from the West about Xinjiang and Tibet.

Xi, a true student of Sun Tzu

Sun Tzu, the great Chinese military strategist, wrote in “The Art of War” 2,500 years ago: “To win 100 victories in 100 battles is not the acme of skill. To subdue the enemy without fighting is the acme of skill.”

And that is what Xi has in mind, allowing China by its newfound trade leverage to project more military power in the Western Pacific without firing a single missile.

Xi may explicitly or implicitly use the threat of limiting rare earth exports to goad Trump to dial down support for Taiwan or reduce patrols in the South China Sea [less support for ally, the Philippines] or the Taiwan Strait.

If Trump buckles under Chinese pressure – following his own puny ‘The Art of the Deal’ – Kristof writes that it would be an enormous setback for America’s standing in Asia [ and definitely, the world at large] and a big gain for Chinese influence world-wide.

And there would be a growing risk of massive Chinese show of force in the Taiwan Strait.

There is no reason for Trump and his MAGA-supporters to be triumphant about a so-called landmark deal.

The truth of the matter is that Americans may have lost not just a trade war but a large part of their global credibility and influence for years to come, in ways that would be seen globally as a harbinger of American decline.

The writer can be reached at:

shashimalla125@gmail.com  

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