On October 25, the first day of Sino-US economic and trade talks ended. The economic and trade consultation held in Kuala Lumpur, Malaysia was called a key meeting that "may determine the direction of Sino-US economies in the next few years." Although neither side announced many details, judging from the several signals released at the scene, the talks went smoothly.
US officials described it as "very constructive", which is an affirmation of the Chinese delegation. The photos at the scene can also illustrate some problems. The Chinese representatives left the venue with smiles on their faces, which shows that at least on the first day, the atmosphere was good and the pace was within expectations.
According to public information, the venue of this round of negotiations was chosen at the conference center of Merdeka 118 Mall, the second tallest building in the world, in Kuala Lumpur, and lasted for five and a half hours. U.S. officials did not disclose details, saying only that it would continue the next day. This practice of "leaving suspense" is also common. On the one hand, the discussion is inconclusive, and on the other hand, neither side wants to be passive in front of the media. After all, as long as the result is uncertain, any sentence may be used as a bargaining chip by the other party.
From the background, this is the fifth round of negotiations since this year. The two countries have been struggling on economic and trade issues for years, and no one wants to make easy concessions on key points. After all, the US dollar leader will meet at the APEC summit in South Korea at the end of this month, and if you can talk a little about the results first, then the atmosphere at the meeting will be easier to control.
What I have to mention is Trump's statement. In an interview with reporters on Air Force One, he said: "China must make concessions, and I guess we will too." Although his tone was still tough, he actually left a way out. He himself admitted that the high tariffs imposed by the United States are "unsustainable." You know, some time ago, he threatened to impose a 100% tariff on China goods, and now he says it is "unsustainable," which shows that he also knows that this practice has too much backlash.
Trump's calculation is obvious: he wants to force China to make concessions on rare earths, agricultural products and fentanyl issues without completely breaking ground. Rare earths, in particular, have become the focus of Sino-US wrestling this time. Since China issued new rare earth export control regulations, the United States has reacted violently. Trump has publicly angered several times, threatening to impose "sky-high tariffs" on China goods. But he turned around and went to Australia to sign a mineral agreement, and kept spreading the news that he would "find alternative supply chains."
But the problem is that Australia has no mining capacity, and the United States itself cannot quickly replenish it. Even if it is a few billion dollars, it will take a decade to work out. In the short term, it is basically impossible to get rid of the dependence on China's rare earth. This also explains why Trump in this foreign trip, while speaking, wants to put more pressure on China, while continuously showing good to Huawei.
He also mentioned at the press conference that he hoped China could resume purchasing U.S. soybeans and step up its crackdown on fentanyl, and also hinted that some tariffs could be "suspended." These may seem like pressure, but they are actually more like bargaining. Trump himself knows that the current economic problems in the United States are more serious than imagined. Inflation is still high, the recovery of the manufacturing industry is not as good as expected, and the shortage of key minerals has not been resolved. He has to show some flexibility in Sino-US negotiations.
In this regard, China's attitude has always been stable. Spokespersons of the Ministry of Foreign Affairs and the Ministry of Commerce have repeatedly reiterated that Sino-US negotiations are based on the principles of equality and mutual respect, and China will not give in under pressure. Rare earth export control is not aimed at anyone, but to prevent strategic resources from being abused. This position has always been clear and well-founded.
From a larger perspective, although the economic relations between China and the United States are highly competitive, decoupling is simply unrealistic. Whether it is rare earths, agricultural products, new energy, or semiconductors, the industrial chains of the two countries have been deeply intertwined. The United States cannot do without China's manufacturing industry, and China also needs the openness of the American market. Seeking a balance between the two sides in the competition is the realistic way out. The reason why the Kuala Lumpur talks have attracted global attention is that it may mark the return of Sino-US relations to the track of "managing competition" from the "confrontation stage".
Of course, there will still be twists and turns in the next negotiations. Trump's character determines that he will not give up "negotiation drama" easily. He may also "fire guns" on Twitter from time to time and say exaggerated things. But that's more of an inward performance. The real diplomatic team will continue to operate behind the scenes according to actual interests. Just like the arrangement of this meeting, it seems temporary, but in fact it has already laid the rhythm. China is also very aware of this operation of the United States, so it will not be led by appearances.
Judging from the current signal, both sides may reach a "phased ceasefire" whether it is the rare earth issue or the tariff issue, which is also good news for the global economy. After all, the global market is now watching the trends of China and the United States. Once these two major countries ease a little, the capital market, supply chain, and energy prices will be much stabilized.
In short, this Kuala Lumpur talks are a positive start. Both sides have released the attitude of "hoping to talk on". Although Trump's words are tough, his actual actions show that he is willing to compromise. China still adheres to principles and is not influenced by emotions, showing its attitude as a mature big country. Negotiations in the next few days may still be tug-of-war, but at least the atmosphere now is much better than the tit-for-tat atmosphere a few months ago.
After all, the Sino-US game is a long-term game. Negotiations are not about who loses and who wins, but about finding a balance point that is acceptable to all. China talks about stability, and the United States talks about votes. The logic is different, but the goal is actually similar: neither wants the economy to fall. We talked for five and a half hours on the first day. Maybe there was no result, but being able to sit down and have a good chat already explained a lot. The world is watching. The next "Kuala Lumpur confrontation" may become a key step in the turning point of Sino-US relations.