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WASHINGTON: The US and China may have bought themselves breathing space with an extended trade truce, but analysts warn that time is running out for the world\u2019s two biggest economies to resolve their strategic rivalry.<\/p>\n
President Donald Trump and Chinese counterpart Xi Jinping concluded a pomp-filled summit Friday, with the US leader confirming they would meet twice more this year.<\/p>\n
But even as Trump and Xi \u201care making nice,\u201d their countries \u201cremain locked in a bitter competition over trade, tech, Taiwan, defense, rare earths and industrial policy,\u201d said Daniel Russel of the Asia Society Policy Institute.<\/p>\n
Daniel Kritenbrink, a former US official now with The Asia Group consultancy, said there\u2019s \u201cno doubt that both leaders would like to see stability in the relationship, at least through the end of the year.\u201d<\/p>\n
However, \u201cyou\u2019d have to see further tangible outcomes for this truce to extend in the long run.\u201d<\/p>\n
Some feel Beijing has \u201clargely not lived up to the commitments it made\u201d at earlier meetings, he added, noting many US officials \u201chave articulated their profound frustration with the Chinese.\u201d<\/p>\n
Xi and Trump agreed to a trade truce last year during a meeting in South Korea, after a bitter tit-for-tat fight that saw tariffs soar over 100 percent at one point.<\/p>\n
As part of the agreement, Beijing agreed to buy more US soybeans and other agriculture products, and to suspend rare earths restrictions for a year.<\/p>\n
The pact was originally due to expire in November but both sides agreed this week to extend it until January 10, US Treasury Secretary Scott Bessent said.<\/p>\n
\u2019Short leash\u2019<\/p>\n
Trump\u2019s top trade official Jamieson Greer told CNBC on Friday that Washington views such extensions as \u201ccompliance periods.\u201d<\/p>\n
\u201cI think US officials would say China is doing just barely enough to maintain the agreement and no more,\u201d Kritenbrink said.<\/p>\n
\u201cThat\u2019s unsustainable over the long run,\u201d he added.<\/p>\n
The brief extension \u201cwas the preferred position of the Americans,\u201d Mary Lovely of the Peterson Institute for International Economics told AFP.<\/p>\n
She added that while Beijing would have preferred a longer rollover, the current situation points to Washington\u2019s anxiety about the delivery of rare earth magnets and how officials \u201cwant to keep this on a short leash.\u201d<\/p>\n
\u201cIt\u2019s not clear anymore how much their threats of high tariffs actually move China,\u201d she said.<\/p>\n
\u2019Bitter competition\u2019<\/p>\n
For now, Greer said that both countries have made \u201cprogress\u201d on other economic outcomes and expect to release more details Monday.<\/p>\n
\u201cWe want to have some subset of goods that we can trade with the Chinese on a more preferential basis,\u201d he said.<\/p>\n
He added that both sides have agreed on products that can be left aside in future trade disputes.<\/p>\n
Greer is set to host G20 trade ministers in Wisconsin next week, with US tariff threats and the issue of excess capacity \u2014 a key concern surrounding Chinese industry \u2014 expected to be discussed.<\/p>\n
Washington and Beijing have also agreed to set up some kind of notification system for artificial intelligence threats between the two countries, Bessent said.<\/p>\n
Peter Richardson of Counterpoint Research said the channel could be as simple as a hotline, but it will be tough to define what triggers it.<\/p>\n
\u201cIt is often very difficult to tell quickly whether an AI incident was state-directed, a rogue actor or an accident,\u201d he said.<\/p>\n
\u201cGiven the rivalry we don\u2019t expect this to lead to any comprehensive international framework for AI regulation, but it would be the first practical guardrail,\u201d he added.<\/p>\n
Kritenbrink, for his part, said the summit has done \u201cnothing to curb the competitive instincts of both sides on AI.\u201d<\/p>\n
\u201cI don\u2019t think you\u2019ll see any slowing down.\u201d<\/p>\n<\/div>\n