While headlines are dominated by election news and the war in Iran, our government is quietly getting ready for one of the most important events of the year. In under four weeks, President Donald Trump will host Chinese President Xi Jinping at the White House. The meeting comes at a crucial juncture for bilateral relations. Currently, the United States and China are in a fragile trade truce that is set to expire by the second week of November. Trump should capitalize on the moment to build an enduring U.S.-China economic relationship that will improve the lives of average Americans. To do so, he’ll need to push through a bureaucracy that is taking too long while also selling any new economic deal to a skeptical public.
Trump’s May visit to China and his strong relationship with Xi present the U.S. government with an opportunity to demonstrate that constructive U.S.-China relations benefit the people. While in Beijing, Trump focused on the heart of the U.S.-China relationship, our countries’ complex commercial ties that sustain millions of jobs on both sides of the Pacific. Trump noted, “This bond of commerce and respect that stretches back 250 years is the foundation for a future that benefits both of our nations.”
Americans are understandably skeptical of the benefits of increased economic interaction with China. For many, the rise of China’s economy meant the decline of reliable manufacturing work in the U.S. But Trump’s focus on an improved economic relationship and respect for China and its leader is not a call to return to the policies of previous decades that led to the hollowing out of America’s industrial base and the abandonment of many workers across the country. Rather, the president wants to build a new economic understanding with China, one based on fairness and reciprocity.
To that end, Trump and Xi agreed in May to the creation of a bilateral board of trade and a board of investment. The goal of these mechanisms is to lower barriers to trade and investment by defining non-sensitive areas of economic interaction. They will also help both countries right-size the national security challenge posed by the other. For too long, good economic policy has taken a back seat to exaggerated national security concerns. Both countries have legitimate national security priorities, but a decade of threat expansion has left us unable to properly identify when U.S. national security is threatened. These boards will increase bilateral trade and investment, where the benefits are clear, while protecting sensitive areas when necessary. This costs the public nothing but can allow us to make great progress.
Trump’s May visit to Beijing has set the table for improvements in our economic relationship with China. The only question is, will his administration work to implement the president’s vision? Already, the boards of trade and investment are being bogged down by bureaucracy. After initial fanfare, both institutions have failed to produce a plan for implementation. The U.S. and Chinese sides haven’t even agreed on the scope of coverage for each board.
With the Sept. 24 meeting between Trump and Xi fast approaching, both countries should redouble efforts to create the trade and investment boards. The boards should convene before the presidents meet again at APEC in Shenzhen in November and establish whitelists for industries where trade and investment will be allowed. China should further open to American pharma and financial services, and America should develop sensible ground rules for U.S. production of EVs and batteries using Chinese technology. Trump should also overturn U.S. export controls on advanced chips, a policy championed by the Biden administration. These ill-conceived export control policies have punished American businesses and done little to improve U.S. national security.
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The boards of trade and investment are one piece of a larger puzzle. Right now, both countries have paused the implementation of certain punitive economic measures until the middle of November, pending a larger agreement. The trade truce should be extended, and both sides should return to the status quo ante. In other words, all sanctions and other restrictive lists published since Trump met with Xi in South Korea should be returned to where they were before the two presidents met, and the Chinese side should do the same. A consultation system should be established that allows the two sides to first discuss any additions to these lists. The mechanism would not prevent one side from listing an entity, but it would facilitate discussion of the reasoning for such actions.
Time is running out for our countries to avoid cementing our current economic stalemate into a long-term standoff. Trump has demonstrated his close involvement in managing U.S.-China policy. Any major deal is going to come from him. Considering Trump’s preference for face-to-face diplomacy, that means the September meeting is the last chance for the two leaders to talk before the trade truce expires by the second week of November. Subsequent meetings in Shenzhen (mid-November) and Miami (December) will occur after the trade truce deadline passes. Should the trade truce lapse, the economic impact will be wide-ranging for Americans. We cannot let 250 years of shared commercial history be thrown aside over bureaucratic squabbles. Let us begin the work of building a new U.S.-China economic relationship that prioritizes American workers.
Stephen Orlins is the president of the National Committee on U.S.-China Relations. The views expressed in this article are those of Stephen Orlins and do not represent the views of the National Committee