A meeting between Chinese paramount leader Xi Jinping and US President Donald Trump apparently is back on after negotiators for the two countries agreed to a framework for a trade deal yesterday.
The two leaders are to discuss the framework during their expected meeting Thursday on the sidelines of the Asia Pacific Cooperation Forum (APEC) summit in South Korea.
With relations between Beijing and Washington at their lowest point in decades and government-to-government communication broken down, meetings between the leaders of the two countries are essential for keeping trade and geopolitical tensions from spinning out of control.
Xi and Trump have not met since the latter’s second term began in January.
It does not bode well, however, that the signing of a comprehensive trade agreement is not in sight.
Under the framework agreed to yesterday, the US will back off the 100 percent tariff on Chinese goods that Trump threatened to impose on 1 November while China will defer a tightening of controls over rare earth mineral exports that it had said it would introduce on 1 December.
China also will resume significant soybean purchases from the US and Beijing and Washington have come to final terms on US operations of China-based TikTok, a globally popular social media platform that has raised espionage concerns in the West.
After years of escalating friction, Trump ignited a full-blown trade war early this year by announcing mind-boggling tariffs of up to 145 percent on Chinese goods, prompting Beijing to sharply hike tariffs on American goods.
Under a truce agreed on 12 May, the Trump administration temporarily slashed tariffs on Chinese goods to 30 percent while Beijing rolled back its tariffs on US goods to 10 percent.
Beijing’s most damaging tactic in the weeks before the truce was banning exports to the US of seven types of rare earth minerals.
China controls 90 percent of the global supply of rare earths, which are used to make critical industrial magnets.
Magnet shortages caused some automakers and other manufacturers in the US to roll back production, putting Trump under pressure.
In a show of strength, China did not resume exports to the US of rare earths until 27 June.
Flexing its muscles again, Beijing earlier this month announced new plans to tighten controls over exports of rare earths, prompting to Trump to announce a plan to impose 100 percent tariffs on Chinese goods.
China and the US now seem to have reached another truce in their trade war.
Even if a lasting tariff and broader trade deal is reached, distrust and geopolitical friction between Beijing and Washington run so deep that commercial relations will remain unpredictable.
Operating in China had become difficult for foreign corporations even before the tsunami caused by the eruption of a full-blown trade war.
The regime has a long history of detaining local and foreign employees of multinational companies on trumped-up grounds, including for spying.
Given the utter lack of judicial independence in China, charges inevitably result in convictions.
Westerners of Chinese origin long have been particularly susceptible to arrest on dubious charges.
Risks of detention are highest for corporate personnel, academics and scientists with professional or personal links to the US military or other organizations inherently viewed with suspicion by the Chinese regime.
The regime could use any number of pretexts to detain foreign corporate personnel, including peripheral dealings with the Taiwanese military, violations of Internet and other censorship, witting or unwitting criticism of the Chinese authorities on social media, and breaches of environmental, health and other regulations.
Also, the extremely broad definition of state secrets makes it relatively easy to arrest foreigners for espionage.
The Chinese regime over the years has imposed exit bans on foreigners. The tactic often is intended to achieve outcomes favorable to Chinese parties to commercial disputes. Even foreigners not personally liable or who left a company in question years earlier have been hit with exit bans. Foreigners subject to exit bans typically are not aware of it until they attempt to catch a flight out of the country.
Multinationals should not send anyone to China who the regime might have a pretext to detain. Routine background checks of prospective travelers are recommended.
Employees or prospective employees who multinationals are considering sending to China should be questioned about their understanding of the risks involved.
As a precaution, corporate personnel should travel to China in pairs or groups.
Multinationals and their personnel who visit China should be extremely careful not to breach the regime’s concept of state secrets, however nebulous that may be.
Personnel while in China should avoid infractions or indiscretions of any kind.
Tensions between China and Western governments should be monitored constantly.
