American President Donald Trump's first summit with his Chinese counterpart, Xi Jinping, in April this year in Florida produced a lot of warm and fuzzy rhetoric but no big win for the former real estate magnate. The best thing one could say about the encounter at Trump's Mar-a-Lago resort is that it allayed, at least temporarily, the fear that the new president elected on a protectionist agenda would carry out his threat of imposing punitive tariffs on Chinese imports and destroy the economic foundations of the world's most important bilateral relationship.
The reason for the reprieve, it turned out, was not Trump's change of mind, but the intrusion of a more pressing matter: North Korea's dangerous quest for nuclear weapons capable of striking the continental United States. Without receiving a firm pledge of full Chinese cooperation, Trump, a foreign policy neophyte, apparently believed that he could leverage his threat of curtailing Chinese imports to get Beijing to adopt punishing sanctions and force Pyongyang to suspend, if not abandon, its nuclear and missiles programs.
Trump's naivete soon became clear. The Chinese played him like a violin. On the issue of bilateral economic relations, Beijing made a few minor concessions, such as lifting the ban in U.S. beef imports and opening the Chinese market to American electronic payment services companies and liquefied natural gas. Seemingly by pure coincidence, the Chinese government granted Ivanka Trump's company provisional approval to register three new trademarks in China -- on the same day the first daughter and her husband dined with Xi at Mar-a-Lago. To gain more time to pacify the mercurial new occupant of the White House, China agreed to a "100-day action plan" -- a set of negotiations aimed to achieve specific objectives to reduce trade tensions.
As for North Korea, China became more cooperative, but resisted the calls for the most severe sanctions against North Korea, its long-time ally and trouble-making neighbor.
Although Trump immediately hailed China's token trade gestures and heaped praise on Xi (whom he called a "very talented man and a very good man"), it quickly became obvious that the transactional president had cut a bad deal for himself. The 100-day plan process collapsed with no agreement while North Korea accelerated its pace of testing intercontinental missiles and nuclear weapons.
Now that Trump is headed for Beijing for his second encounter with Xi, the question is whether he can do better.
Both Trump and Xi understand the enormous stakes of a successful summit. For Xi, who has gained added authority from the just-concluded 19th congress of the Chinese Communist Party, he needs to show his colleagues and the Chinese people that he can handle Trump and put the U.S.-China relations on a stable footing. Despite his nationalist rhetoric to make China great again and risky moves in the South China Sea, Xi understands that he could imperil his "China Dream" and endanger his own political future if a premature and rapid deterioration of Chinese-American relations result in a disastrous collapse of Chinese exports to the U.S. His challenge is to defend China's bottom line on trade and North Korea but also give Trump enough "face" so that Trump can go home satisfied that he has got a good deal.
On trade, it is conceivable that China would make slightly bigger trade concessions but resist the most extravagant demands. On North Korea, Xi's room for maneuver would be far more limited. He might agree to further curtail the use of North Korean laborers to give Trump a "win," but cannot be expected to endorse the most drastic measure, such as cutting off oil export.
For Trump, the overriding objective is to score a tangible diplomatic victory. So far his domestic and foreign policy record is threadbare. Extracting a major trade concession from China, which ran a trade surplus of about $310 billion with the U.S. in 2016, will go a long way toward rehabilitating Trump's tarnished reputation as a dealmaker. Needless to say, he will also be adamant that Xi do more to rein in Kim Jong Un, the North Korean dictator. To underscore his point that China can do a lot more to make Kim behave, Trump will probably cite the lack of provocations by Pyongyang around the CCP's 19th congress, which crowned Xi as China's new strongman, as evidence that Beijing has the necessary leverage against Pyongyang.
While both Xi and Trump have strong incentives to make the Beijing summit a success, such an outcome is by no means guaranteed.
In transactional terms, the most difficult issue is the price Trump is going to ask. Eager to demonstrate his toughness and get even with a business partner (in this case Xi) who had bested him in the last round, Trump will be motivated to demand far more than Xi is prepared to offer. The 100-day action plan fell apart in July reportedly because Washington was making what Beijing saw as excessive demand. Should this happen again, the Beijing summit would produce no substantive agreement on trade, and Trump could go home both empty-handed and angry.
Progress in securing greater Chinese cooperation in containing North Korea is equally doubtful. Given China's fundamental national interest in maintaining North Korea as a security buffer against the U.S., Beijing probably has done nearly all it can without risking a regime collapse in Pyongyang. Of course, Trump will urge Xi to apply the same pressure that temporarily stopped Kim from firing missiles during the 19th party congress. But his Chinese host will likely rebuff him politely but firmly, claiming with perfect plausibility that the absence of Pyongyang's provocations was a pure coincidence and had nothing to do with Chinese pressure.
Spectacular show
Despite the imperative to turn the Beijing summit into personal political wins for Xi and Trump, the yawning gap between what Trump wants and what Xi can give can only mean that the outcome will be mixed at best. Xi will not let Trump go home totally empty-handed, but will deny him the big concessions on trade and North Korea Trump craves. The most likely outcome of the summit is a series of specific agreements between Chinese and American companies that will allow Trump to claim new job opportunities for his blue-collar voters.
To compensate for their unwillingness to make major trade and diplomatic concessions, Trump's Chinese hosts will do all they can to make their guest feel good about the trip to the Forbidden City -- and the Great Wall -- regardless of the substantive outcomes of the summit. We may recall that the best foreign trip Trump has made as U.S. president was his visit to Saudi Arabia because his hosts treated him like royalty.
Compared with Chinese mandarins, who mastered the art of pleasing emperors more than 2,000 years ago, the Saudi may look like amateurs. It is entirely plausible that Trump's hosts will order thousands of factories to close so that he will be spared Beijing's signature toxic smog. Historic sites like the Great Wall and the Forbidden City will be cleared of tourists so that Trump can enjoy them exclusively.
The second Sino-U.S. summit may not produce the trade and diplomatic agreements crucial to stabilizing Beijing's ties with Washington, but we can at least be guaranteed a spectacular show worthy of an imperial visit.
Minxin Pei is a professor of government at Claremont McKenna College and non-resident senior fellow of the German Marshall Fund of the United States.
Do you live in Asia? How do you feel about Trump visiting the region?
- Do you believe Trump can make Asia a more secure place?
- Who will be the strongest political force in East Asia in 2030? US? China? Other?
- Is the US an indispensable economic partner or should Asia become more self-sufficient?
Email us your answers to: nar01@nex.nikkei.co.jp
