Xi warns Trump that mishandling of Taiwan could lead to conflict

China’s Xi Jinping told U.S. President Donald Trump that trade talks were making progress at the start of a two-day summit on Thursday but warned that disagreement over Taiwan could send relations down a dangerous path.

Xi’s remarks on Taiwan, the democratically governed island claimed by Beijing, came in a closed-door meeting of the leaders of the world’s two largest economies ‌that ran more than two hours, China’s Foreign Ministry said.

They represented a stark warning during a pomp-filled occasion that otherwise appeared friendly and relaxed, although the U.S. summary of the talks made no mention of Taiwan.

Trump did not respond when a reporter shouted a question about whether they had discussed Taiwan as he posed for photos with Xi at the Temple of Heaven, a UNESCO World Heritage Site where emperors once prayed for good harvests.

Ahead of the trip, Trump said he expected Xi to raise the thorny issue ⁠of U.S. arms sales to Taiwan, which China opposes. A $14-billion US package is awaiting Trump’s approval.

The U.S. provides Taiwan with the means to defend itself, despite a lack of formal diplomatic ties, though since his first term Trump’s statements of support on that issue have been viewed as less full-throated than those of other recent U.S. presidents.

The Chinese readout focused on the leaders’ shared desire to reopen the Strait of Hormuz, effectively closed due to the Iran war, and Xi’s apparent interest in buying American oil to reduce China’s dependence on Middle East supplies.

On the war, the White House readout indicated that “both countries agreed that Iran can never have a nuclear weapon.”

Both sides “discussed ways to enhance economic co-operation … including expanding market access for American businesses into China and increasing Chinese investment into our industries,” the Washington readout said.

The U.S. also said there had been progress on limiting fentanyl precursors — which largely originate in China — but that more needed to be done.

Trump and Xi were attending state banquet attended by officials and business leaders, before taking tea and lunch together on Friday.

Trump extends invitation

After an opening ceremony that featured an honour guard and throngs of children excitedly waving flowers and flags, Xi began the summit by telling Trump that stable relations between China and the U.S. benefit the entire world.

“When we co-operate, both sides benefit; when we confront each other, both sides suffer,” he said in brief remarks that were open to media.

“You’re a great leader, sometimes people don’t like me saying it, but I say it anyway, ” Trump responded.

It is the first visit by a U.S. president to the country’s main strategic rival since Trump’s last trip there in 2017, and the first of what officials hope will be multiple meetings this year, including at multilateral summits.

Trump at Thursday evening’s banquet invited Xi for a Sept. 24 visit at the White House. While Xi met with Trump at Mar-a-Lago in 2017, his last visit to the White House was two years earlier, during Barack Obama’s second term as president.

U.S. executives also on trip

Xi said negotiations between U.S. and Chinese economic and trade teams in South Korea on Wednesday had reached “overall balanced and positive outcomes,” according to the Foreign Ministry’s readout.

The negotiations had aimed to maintain the trade truce struck between Trump and Xi last October and establish mechanisms to support future trade and investment, officials with knowledge of the matter said.

Joining Trump on the trip are a group of CEOs looking to resolve issues with China, including Elon Musk and Nvidia CEO Jensen Huang, a late addition. Trump has said his first request to Xi will be to “open up” China to U.S. industry. Trump introduced the executives to Xi during the talks.

Eric Trump, his son and vice-president of the Trump Organization, is also in Beijing. The company has said he is there in a personal capacity, as has the White House. Some Democrats have said the younger Trump’s business dealings with Bitmain, a Chinese cryptocurrency mining equipment maker, pose a potential conflict of interest.

The president criticized his Democratic predecessor Joe Biden for allowing his son Hunter to accompany him to China when Biden was vice-president. He accused the younger Biden of using his influence to secure China’s financial backing for his investments.

Boeing CEO Kelly Ortberg is also there, as it is hoped China will purchase more American airplanes, as well as farm goods and energy to cut a trade deficit that has long irked Trump. Beijing wants the U.S. to ease curbs on exports of chipmaking equipment and advanced ​semiconductors, officials involved in the planning said.

Trump’s ability to tariff exports on China and other countries have recently been constrained by U.S. courts. The Iran war has also boosted inflation in the U.S. and escalated the risk that Trump’s Republican Party will lose control of one or both legislative branches in November’s midterm elections.

Though the Chinese economy has faltered, Xi is likely eager to maintain a trade truce struck last ‌October, in which Trump suspended triple-digit tariffs on Chinese goods and Xi backed away from choking global supplies of rare earths, which are vital in making items from electric cars to weapons.

Weakened Trump in China for high stakes talks with Xi 

With the Iran war unresolved, and the Strait of Hormuz still effectively closed, U.S. President Donald Trump has arrived in China in a weakened position for a high-stakes summit with Chinese President Xi Jinping — Trump’s first since 2017, during his first presidency. — Thomson Reuters