US touts coal purchases, progress on trade vehicle, following Xi visit

Por Oliver Ward, Phelim Kine and Ari Hawkins — POLITICO – TOP Stories

Expectations were low for Chinese President Xi Jinping’s visit to Washington as he and Trump sought to keep the relationship on an even keel ahead of the U.S. midterms. But even by that measure, the trip delivered limited tangible progress on trade.

The U.S. summed up the visit’s outcomes on Friday night, saying that China will buy more U.S. coal, they made incremental progress on potential future tariff cuts and created a group to work on ag trade. The visit also extended a fragile trade truce by two months.

Xi’s three-day visit, the first in more than a decade, came just weeks before the U.S. midterm elections and as Xi wrestles with an economic downturn ahead of his expected ascension to an unprecedented fourth term as the head of the Chinese Communist Party next year.

The outcomes are unlikely to satisfy expectations from industry and fall short of ambitions previously outlined by senior officials, who pitched the summit as a chance to reset the U.S.’s economic relationship with the world’s second-largest economy. And there are key differences between the White House readout of the leaders’ summit outcomes and a Chinese Ministry of Commerce fact sheet published Saturday that suggest both sides continue to struggle for consensus on critical trade friction points.

Minutes after Xi landed in the U.S. on Wednesday, Treasury Secretary Scott Bessent announced the two sides had extended a trade truce hammered out in South Korea last year, punting a potential return for triple-digit tariffs and draconian export controls on Chinese critical minerals until early 2027.

In a White House fact sheet published close to midnight on Friday, the administration said Beijing has also agreed to buy at least 10 million metric tons of coal from the U.S. annually in 2027 and 2028. Treasury Secretary Scott Bessent had teased potential ag purchases coming out of the visit, but the fact sheet makes no mention of any other commodity deals.

The two sides also hashed out additional details on the scope of the “Board of Trade” — but did not immediately implement tariff cuts, falling short of expectations from industry that $30 billion worth of goods could see relief in both directions.

The government-to-government vehicle lays the groundwork for both sides to cooperate on tariff carveouts in non-sensitive industries and was one of the key deliverables from Trump’s May visit to China.

U.S. ag products, fish, seafood, wood, cosmetics and medical devices could receive “more favorable tariff treatment” in the Chinese market under the vehicle, according to the fact sheet. Meanwhile Chinese consumer products could benefit from better tariff access to the U.S. market, with the U.S. singling out appliances, toys, holiday decorations and children’s car seats.

The two sides agreed to stand up an agricultural trade working group to discuss trade barriers to U.S. ag products, the fact sheet says. The U.S. also welcomed the arrival of two giant Pandas to the Atlanta Zoo.

But there are some important differences in the two readouts — as occurred after the two leaders’ Beijing summit in May — that indicate unresolved differences on key issues between the two sides that may reignite trade tensions in the coming months.

The Chinese readout doesn’t mention a coal purchase pledge, nor does it provide any details on the categories of exports that the Board of Trade tariff reductions will apply to. The Chinese fact sheet also doesn’t back up the White House’s claim that the two sides had established a Board of Investment to discuss “commercially meaningful investment-related issues.” The Commerce Ministry statement said the two countries’ militaries will soon ink a “memorandum of understanding on strengthening crisis communication and prevention,” a development not referenced in the White House statement.

The Commerce Ministry fact sheet also doesn’t reference the issue of China’s ongoing restrictions on exports of rare earths that are essential to U.S. civilian and military defense industries. The White House readout said that Trump and Xi had agreed to “continue to work on U.S. concerns” about unreliable export volumes of those materials. Critical minerals and rare earths have emerged as a flashpoint in the U.S.-China relationship as the U.S. accuses Beijing of continuing to restrict vital exports and threaten U.S. industries.

The “Board of Investment” — another outcome of Trump’s China visit — has received much less play since its unveiling in May, amid disagreement within the administration over how it should be structured and scrutiny from Republican lawmakers.

The visit readout suggests that the vehicle is less mature than its Board of Trade counterpart. The Board of Investment has been “operationalized,” the fact sheet says, adding only that it will serve as a platform for discussions on “potential investment opportunities” and “investment-related impediments.”

Trump may have roped Xi into his preferred nomenclature for artificial intelligence, however. The fact sheet says the two leaders agreed to use Trump’s preferred term of “super intelligence” to describe the emerging technology. On his way to Knoxville to attend the Texas-Tennessee college football matchup on Saturday, Trump told reporters that the Chinese president “likes the idea of changing the name.”

Some lawmakers, including Rep. Ro Khanna (D-Calif.) and a raft of other Democrats, had been hoping the two leaders would make AI guardrails a central focus of the talks. But Trump dashed that hope Saturday, noting the conversation didn’t go much beyond vocabulary and arguing that fears of AI’s threat to humanity are a hoax.

“We didn’t spend that much time talking about it,” Trump told reporters, then went on to explain that he does not want to collaborate with China on AI. “I would rather not integrate because we’re leading by a lot. When you’re leading, you don’t open it up to each other.” Trump also said the two didn’t spend much time on Taiwan.

Beijing and Washington have agreed to establish a mechanism to manage the risks related to the development of AI. That will include what the White House readout describes as “The U.S.-China Super Intelligence Dialogue” as well as a “bilateral communication channel” to report AI safety incidents. The two sides will convene the dialogue in November, per the Commerce Ministry’s readout.

POLITICO has already reported that the AI safety communication channel is far simpler than suggested, amounting to a hotline between Bessent and Chinese Vice Premier He Lifeng that would allow them to alert each other on AI incidents.

It’s possible that those unresolved issues will be pushed onto the agenda of two upcoming meetings between the two leaders later this year. Xi and Trump confirmed Friday that they will meet on the sidelines of the APEC meeting in Shenzhen, China, in November and at the G20 leaders meeting in Miami in December.

Fonte: POLITICO – TOP Stories