|
Readouts from preparatory phone calls ahead of US President Donald Trump and CCP General Secretary Xi Jinping’s meeting next week indicate that trade, US arms sales to Taiwan, and the Iran War may be the top issues of discussion between Trump and Xi. Trump is scheduled to meet with Xi in Beijing on May 14 and 15. PRC Foreign Minister Wang Yi spoke with US Secretary of State Marco Rubio on April 30. PRC Vice Premier He Lifeng called US Secretary of the Treasury Scott Bessent and US Trade Representative Jamieson Greer on the same day to discuss a range of diplomatic, security, and trade issues in preparation for the summit. Both countries have recently placed trade and investment restrictions on each other despite a one-year trade war “truce” since October 2025. The PRC implemented a new law on April 7 that establishes its ability to punish foreign firms that “undermine China’s industrial and supply chain security,” including by complying with sanctions placed on the PRC or attempting to decouple from PRC supply chains. The United States has implemented trade restrictions to de-risk supply chains and prevent advanced technology transfer to the PRC. The United States is also pursuing investigations on PRC goods that could lead to new tariffs by the end of 2026, following the US Supreme Court’s cancellation of Trump’s “reciprocal” tariffs under the International Emergency Economic Powers Act (IEEPA) in February.
Xi will likely urge Trump to decrease or stop arms sales to Taiwan. The Trump administration approved an arms package to Taiwan worth 11 billion US dollars (USD) in December 2025 and is reportedly considering an even larger arms package worth 14 billion USD that it has yet to publicly disclose. Wang Yi warned Rubio that the Taiwan issue is the “biggest risk factor” in US-PRC relations. Xi previously warned Trump in a February 4 call against selling more arms to Taiwan, implying that it may jeopardize the upcoming Trump-Xi summit or other aspects of bilateral relations. Xi will likely have less leverage to push Trump on arms sales now that Taiwan’s legislature has approved a 25 billion US dollar (USD) special defense budget to fund both the December 2025 sale and future sales.
Xi may also push Trump to lift Iran-related sanctions on the PRC and work to resume the flow of trade through the Persian Gulf. The US blockade of Iranian ports and Iran’s intermittent closure of the Strait of Hormuz harm PRC energy security. The PRC is more resilient to economic shocks from the Iran War than most of its neighbors, however, and reaps some geopolitical benefits from the war and blockade continuing, so Xi is unlikely to strongly prioritize pressuring Trump to end the war at this time.
|
