Alex Christoforou and Alexander Mercouris discuss the G20 Osaka compromise between President Trump and President Xi, to pause the ongoing trade dispute and continue negotiations for a deal between their countries. Trump agreed to allow US companies to sell parts to Huawei, while not excluding the firm from the Government’s blacklist. Trump told reporters that “US companies can sell their equipment to Huawei,” providing that equipment poses no “great national emergency problem.” Trump’s ‘backtracking’ was criticized by the establishment media and many members of Congress.
My Comment: Trump’s [minor] concession to the Chinese was in exchange for Xi’s promise that China will import more food from the US. Trump’s supporters among farmers will no doubt be glad. The President’s decision not to levy higher tariffs on Chinese goods shows just how important trade relations between China and the US are. Even though the US has the know-how and the capital and the land and the skilled labor necessary to be self-sustainable, the short term belt tightening and higher prices required for such a dramatic course of action is – given the present political situation – simply untenable. Chinese goods and Chinese demand for US output aren’t going away any time soon.
A good deal can and will be reached between Xi and Trump, but once signed it has to be maintained – and it will be maintained only if geopolitical tensions won’t escalate. And I’m not referring just to the South China Sea, but to Venezuela and Iran as well.
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