China holds what the US needs – but Trump’s tantrums could blow it all up

Trump wants to bring China to heel but Beijing has repeatedly retaliated against his tariff threats, like a parent punishing a toddler having a tantrum

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WASHINGTON DC – Just days before Donald Trump and Chinese President Xi Jinping are due to hold their first face-to-face meeting since 2019, trade negotiators from both sides say they have formulated the framework for an agreement between the two countries. Nervous hours now lie ahead, as lower-level officials from both sides can only hope that Trump sees nothing on television that leads him to blow up the deal.

Trump with leaders of countries at the Asean summit in Kuala Lumpur, Malaysia on Sunday (Photo: Mark Schiefelbein/AP)

The US President’s hasty and reckless decision last week to pull out of trade talks with Canada, and then to impose an additional 10 per cent tariff on all Canadian goods, has exploded like a depth charge in capitals around the world. The idea that any American President would scupper talks simply because of a single, 60-second television advertisement that quotes the late US president Ronald Reagan in his own voice and words might have been unthinkable a week ago. But then, so would the notion that any American President might, without consultation or permission, tear down about a third of the White House. So we are where we are.

Dealing with Trump has never been easy, but as the US President cruises towards the first anniversary of his return to power, his rule becomes more mercurial and his decision-making more quixotic than ever.

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In the geopolitical realm, his policy towards Russia’s war on Ukraine has now been through so many U-turns that it begins to take on the form of a spin dryer. In the Middle East, he continues to claim a victory in Gaza that may not yet have been won. And in Asia on Sunday, Trump for the first time came up against a foreign leader – Brazil’s President Luiz Inácio Lula Da Silva – who urged him to get serious and throw the TV cameras out of the room so the two men could get on with the private talks in which they were supposed to be engaged.

That it has taken nine months for any world leader to summon the fortitude to confront Trump over his made-for-TV antics is itself jaw-dropping. Canadian Prime Minister Mark Carney has been witnessed silently smouldering during two Oval Office encounters when he has been put through the classic Trump, impromptu, pre-meeting press conference. Now he must be wondering where all that got him, given that the Reagan TV ad – produced by the provincial government of Ontario – was enough to collapse talks that the federal government in Ottawa was carefully trying to navigate.

Canadian Prime Minister Mark Carney has endured two Oval Office media shows with Trump (Photo: Jim Watson/AFP)

Trump’s insistence that Reagan’s anti-protectionist remarks in the ad are “fake” and may even have been AI-generated reveals either a complete lack of historic knowledge regarding the Republican Party’s traditional positions on free trade (they generally like it), or the thinnest of thin skins on the part of the incumbent, or both. Either way, the trading relationship in Canada is once again in tatters, even though the Government of Ontario (a province whose energy exports to America keep the lights on in Michigan, Minnesota and New York City) is pulling the ad from any further transmission in the United States.

When Trump and Xi meet on Thursday in the city of Busan in South Korea, the world’s most consequential trading relationship will be on the line. On Sunday, negotiators for both countries claimed to have set the stage for the meeting’s successful outcome after talks in Kuala Lumpur. China’s leading negotiator, Li Chenggang, called the talks “candid and in-depth” and said they had reached a “preliminary consensus”.

The agreement reportedly would extend a series of ongoing postponements in the imposition of US tariffs on China that have been witnessed throughout much of this year, and led Wall Street traders to refer to the US President via the acronym “TACO” (“Trump Always Chickens Out”). But the talks in Malaysia also focused on China’s recent implementation of a new licensing system for access to the country’s rare earths. Beijing produces over 90 per cent of the valuable metals and rare earth magnets. Xi’s decision this month to further restrict rare earth exports has caused grave anxiety in Washington, particularly in the country’s defence sector, which is heavily reliant upon them.

Xi seems bewildered by Trump’s unpredictable nature. The US President’s behaviour flies in the face of the focus, strategic calculation and long-term thinking that Beijing traditionally adopts in all negotiations, especially those related to trade. Throughout the last nine months, China has repeatedly retaliated against Trump’s tariff threats, adopting the pose of a parent ratcheting up punishments while waiting for a tantruming toddler to cool down.

On Sunday, Jamieson Greer, Trump’s US Trade Representative, implied there could be further tantrums ahead. After talks with his Chinese counterparts, he said the two countries “are moving to the final details of the type of agreement that the leaders can review, and decide if they want to conclude together”. His carefully worded statement appeared to give Trump the latitude to blow the whole deal up if he wakes up on Thursday and feels like it.