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Donald Trump challenged Xi Jinping on Thursday to rebalance their countries’ “out-of-kilter” economic relationship and “quickly” break the impasse over North Korea’s nuclear and missile development programmes.
“Trade between China and the US has not been over recent years very fair for the US,” the US president said after a morning of meetings with his Chinese counterpart. “We must immediately address the unfair practices that drove [our trade] deficit along with barriers to Market access.”
Mr Trump also thanked Mr Xi for China’s efforts to restrict its trading and financial relationships with North Korea but implied Beijing could do more. “China can fix this [North Korea] problem easily and quickly,” Mr Trump told an audience of US and Chinese officials and business executives. “I know one thing about your president, if he works on it hard it will happen. There’s no doubt about it.”
Mr Xi did not respond to Mr Trump’s challenges directly, instead highlighting how successful US car companies had been in China and the number of jobs created by Chinese Investors in the US. “We will never close our doors,” he said. “They will only open wider and wider.”
“Co-operation is the only viable choice,” Mr Xi said.
Thursday’s meeting highlighted the presidents’ contrasting leadership styles, with Mr Trump speaking directly and in personal terms to Mr Xi, who was far more restrained in his own comments.
“It’s a very good chemistry between the two of us, believe me,” said Mr Trump, who did not “blame” China for bilateral trade tensions. “After all, who can blame a country for being able to take advantage of another country for the benefit of its citizens. I give China great credit. In actuality, I blame past [US] administrations for allowing this out-of-control trade deficit to take place and to grow.”
Mr Trump and Mr Xi spoke after witnessing a signing ceremony for corporate deals with a face value totalling $250bn. They include a “joint development agreement” between the state of Alaska, state-owned China Petrochemical Corp (Sinopec), China’s sovereign wealth fund and Bank of China for a US liquid natural gas pipeline “involving total Investment of up to $43bn”.
According to a brief statement from the Alaskan governor’s office, the project will create as many as 12,000 jobs in the US and reduce America’s annual trade deficit with Asian nations by $10bn. Last year the US recorded a $347bn trade deficit in goods with China.
Most of the deals announced on Thursday appeared to be non-binding memorandums of understanding or earlier agreements that had been repackaged for Mr Trump’s visit. In a statement, Sinopec described its interest in purchasing Alaskan LNG as a “possibility”.
Bill Walker, Alaska’s governor, has been courting China assiduously after three out of the project’s four partners — BP, ConocoPhillips and ExxonMobil — dropped out of the project because of plummeting LNG prices. “Today’s announcement brings a potential customer. Potential is the key word,” said Kerry-Anne Shanks, an Asia gas specialist at Wood Mackenzie, who described the project as “speculative”.
Boeing announced the sale of 300 aircraft worth $37bn to China Aviation Supplies Holding, but did not specify how many of the orders were new.
China Investment Corp, the sovereign wealth fund, and Goldman Sachs also announced the establishment of a $5bn fund with a “broad mandate” to Invest in US manufacturing, industrial, consumer and healthcare companies. Dodd-Frank legislation strictly caps the amount of its own money Goldman can put into the fund, which it will raise and manage, at 3 per cent.
Mr Trump was scheduled to meet Li Keqiang, China’s premier, later on Thursday.
On the eve of his 11-day, five-nation tour of Asia, Mr Trump said Mr Xi had been “really helpful” in dealing with the crisis on the North Korean peninsula but wanted to see what else the Chinese leader could do to help.
While China has worked with the US to apply economic pressure on Pyongyang through increasingly tough UN sanctions, there are concerns in Asia that Mr Trump may be preparing for some kind of military strike on North Korea. In Seoul on Wednesday, Mr Trump warned Pyongyang not to make a “fatal miscalculation” by testing his resolve, adding that the US had three aircraft carriers and nuclear submarines near the Korean peninsula.
Mr Trump has made little progress tackling many of the economic and trade issues he touted frequently as problems in the US-China relationship during the US presidential campaign. Mr Trump and Mr Xi established a high-level “comprehensive economic dialogue” to tackle a range of issues when they met in the US in April but the forum has provided no significant concrete results after seven months.
Matt Goodman, a former Asia economics adviser to Barack Obama and George W Bush, said the US-China economic relationship had not really changed under Mr Trump. “He hasn’t solved any of the real issues in the bilateral economic relationship, nor has he followed through on most of the harsh action he said he would take as a candidate,” said Mr Goodman, who is now at the Center for Strategic and International Studies.
Additional reporting by Emily Feng and Xinning Liu