Biden-Xi crunch talk takeaways
“Planet Earth is big enough for both our countries to succeed”, was the conciliatory message struck by China’s leader Xi Jinping, following his first meeting with US president Joe Biden in a year.
The two leaders held four hours of talks this week at a country estate near San Francisco, the outcome of which suggests the two superpowers can stop competition from veering into conflict, at least for now. Biden labelled them “some of the most constructive and productive discussions we’ve had”.
There are chummy personal gestures to match the warm words, including a photo of two men laughing at a picture on Biden’s phone of a youthful Xi stood in front of the Golden Gate Bridge. Biden also wished Xi’s wife, Peng Liyuan, an early happy birthday, remembering that he and her share the same birthday, coming up next week.
Much more importantly, beyond the diplomatic theatrics, there were some concrete signs of progress: “We’re back to direct, open, clear communications,” declared Biden, after Xi finally agreed to restore military contact with the US, which was severed by China in August 2021 to protest then-House Speaker Nancy Pelosi’s visit to Taiwan.
Restoring these military-to-military channels – considered vital in preventing an accidental escalation – was Washington’s number one priority for Wednesday’s crunch summit.
As for the thorny issue of Taiwan, there was – as anticipated – no breakthrough. Biden stuck to the preferred US position of strategic ambiguity on this matter, refusing to say whether American forces would come to the defence of Taiwan in the event of a Chinese invasion of the island.
But the two sides did manage to make progress on some other less contentious topics. Xi agreed, for instance, to crack down on the export of chemicals relating to the production of the opioid fentanyl, now a leading cause of drug overdoses in the US.
Biden also urged Xi to use his influence over Iran to persuade it not to widen the Hamas-Israel conflict. According to US officials, on this matter, Biden did the talking, while Xi sat and listened. Though we may find out in due course if the Chinese leader was at all receptive to such a plea.
The fact that Biden was able to persuade Xi to restore military channels with Washington – something Anthony Blinken failed to achieve on his trip to Beijing back in June – already indicates a greater willingness from China to de-escalate tensions.
This decidedly less aggressive stance towards Washington in recent months is also evident in Chinese state media: A recent editorial in People’s Daily, the official Communist party newspaper, even went so far as to describe the US as an “old friend”.
So what’s changed?
China’s economic downturn is likely to be a factor.
Beijing is teetering on the brink of deflation while contending with record high youth employment of over 20%, a slumping property sector and a reduced global demand for Chinese goods, amongst other ailments.
And America’s economic containment doesn’t help. According to Beijing, Xi pressed Biden to ease US export controls for sensitive equipment, such as semiconductors, which are “stifling China’s technological progress.”
There’s no indication that Biden agreed to take any such step. That said, Xi was hosted at a lavish dinner of American business leaders last night – attended by the likes of Elon Musk and Apple’s Tim Cook – where he had the chance to give a speech, to persuade them that China is still a good place to invest.
While economic dependence on China is dangerous, ensuring the Chinese economy doesn’t stagnate is in the interest of Washington, and indeed the wider world.
After all, the IMF forecasts that Beijing will be the top contributor to global growth over the next five years, with a share expected to represent over 22 per cent of total growth — double that of the US.
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