Trump, who said he’d do only “great” trade deals and would designate China a currency manipulator, announced $250 billion of trade deals with China as proof that he has successfully wrestled mano-a-mano with Premier Xi and bringing home lots of goodies for long-suffering American workers.
A more accurate point of view might be that Xi appears not to have gone out of his way to put Trump down, as Trump had done during Xi’s Mar-a-Lago visit, by arriving after Xi had landed and other diplomatic snubs. Worse, while Xi was under US surveillance, the US launched air strikes on a Syrian airbase. I thought if I were Xi, I’d be furious at my inability to talk freely to my aides and military advisers, and most important, diplomats who handle Russia and Syria, while such a potentially destabilizing event was in play.
Instead, Xi engaged in the classic Chinese strategy of overwhelming leaders with ceremony and pampering. Quartz explained that this show is effective:
But Chinese president Xi Jinping added a creamy layer of pomp and circumstance to the mix when the White House delegation reached Beijing. Trump has been feted with everything from an unprecedented private dinner in the Forbidden City to a red carpet welcome in Tiananmen Square, the Beijing landmark where hundreds of students were killed by the Chinese military in 1989…
China’s government is “playing Trump like a fiddle,” said Jorge Guajardo, Mexico’s ambassador to China from 2007 to 2013. “You don’t have good chemistry with a Chinese leader who doesn’t speak your language and is geared to not develop chemistry,” he said.
The Communist Party’s top aides are masterful at making diplomats and foreign businessmen feel special…
“You leave that meeting thinking ‘It went great,’” said Guajardo. And then when it comes time to negotiate a practical agreement, if you invoke the special friendship you’ve formed, Beijing officials “laugh and say ‘No, let’s not confuse all that pomp and circumstance with the meat of the matter.’”
“I would be lying to you if I tell you I didn’t fall for it when I was there,” he added.
Max Bauchus confirmed Guajardo’s take:
Max Baucus, a former U.S. ambassador to China, told Bloomberg Television, “This is classic Chinese. They have been doing this for thousands of years.”
“It’s their technique to try to suck you in,” Baucus said. “I think all this ceremony here is designed by the Chinese in part to prevent any serious conversation. The more there is pomp and circumstance, the less there is time to talk.”
This snippet from the Washington Post indicates expectations from this summit were low:
While both sides were pleased to see a high-stakes visit end without incident, there are questions about what was gained and what, perhaps, was lost.
Trump was on good behavior:
Trump brought up North Korea but said Xi could solve it. He raised the trade deficit but said it was not China’s fault. He said the Chinese people are very proud of Xi.
Trump is hampered not only by being a foreign policy newbie who has a distaste for boing up, but also by having gaps in staffing of his Asia team. And underpreparation didn’t help. From Bloomberg:
The non-committal nature of many of the deals reflects a lack of planning or advance work ahead of Trump’s visit to pin down significant agreements or concessions from China, according to two administration officials who asked not to be identified to speak about private deliberations.
The result was a big headline number – $250 billion! – that is mainly hot air. Many of the actual deals were either already done or largely done or things that China wanted and had previously been denied. The rest were handwaves that may not get done. From Bloomberg:
The reality, however, is that the roughly 15 agreements unveiled on Thursday are mostly non-binding memorandums of understanding and could take years to materialize — if they do at all. A day earlier, Commerce Secretary Wilbur Ross announced $9 billion of deals, many also MOUs with few details, rather than contracts…
The officials pointed to the fact that there were no agreements on giving U.S. companies more access to Chinese markets, or opening up Chinese financial markets — something investors have been demanding for years…
China Aviation Supplies Holding Co. agreed to buy 300 aircraft worth about $37 billion from Boeing Co. Still, it was unclear how many of them were new orders..
The lack of substance during the trip risks undercutting one of Trump’s main objectives in Asia: to cut deals that effectively narrow the U.S.’s trade deficits with some of the region’s biggest economies. Trump walked away from Japan and South Korea largely empty-handed from visits that focused mostly on solidifying security ties.
And from the Independent:
There was very little detail announced. A number of them are non-binding, so could easily collapse. Some would probably have happened anyway.
It was announced that China plans to invest $100bn in US energy projects.
This will include an $84m Chinese state investment in West Virginian shale gas and chemical manufacturing and $43m for Alaskan liquefied natural gas.
But the reality is that China has been eager to invest in Western energy for years. It was famously rebuffed by the US Congress when it attempted to buy a minor American oil company called Unocal way back in 2005.
The problem has been Western reticence to allow Beijing to do so. Trump is simply giving China what it has long wanted.
The Independent goes through other major categories. It deems the aviation deal potentially more meaningful but questions how many of the planes were already on order. Qualcomm getting a “deal” to sell chips for Chinese smartphones is just a MOU plus Qualcomm is already a significant in China, raising questions as to whether this handshake was even a meaningful advance. China made another non-binding commitment to import $5 billion of soyabeans. With Chinese demand rising, this again looks like nothing more than extrapolating the current trend.
One possible upside, if you are of the “tough on China” school, is that Trump may engage in another regular practice, of giving good meeting (Trump is apparently very likable in person) and then stabbing his guest in the back a day or two later. From Bloomberg:
Still, the business community in Beijing is abuzz with talk that Trump may announce very tough trade policies against China when he gets back to Washington, said McGregor, who attended the signing ceremony with Ross on Wednesday. The U.S. is currently investigating China’s intellectual property practices, a move that Beijing has said could lead to a trade war.
So the most you can say about this trip is Trump has managed to sabotage himself less than when in the US. Maybe he should stay on the road.