The meeting between U.S. President Donald Trump and China's President Xi Jinping at the Group of 20 summit in Buenos Aires this week is being viewed as a make-or-break moment for the world economy and financial markets. But even if no agreement is reached at the summit, there are at least four reasons to expect a de-escalation of the U.S.-China tariff war.
The first, paradoxically, is the recent shift in U.S. rhetoric away from a focus on American jobs to the explicitly Sinophobic objectives of "containing" China and preventing it from developing into a technological power that could challenge U.S. global hegemony. Now that Xi realizes he is engaged in a generational struggle against the containment of China, he simply cannot afford to lose this opening skirmish of Cold War 2.0.
