US-China trade talks: The fact neither side is saying much on the outcome – says a lot
In the absence of detail, all we can do is read between the lines of what may or may not have been agreed in the London talks between the US and China.
And a degree of scepticism feels appropriate.
The fact neither side is saying much says a lot in itself. A major new breakthrough seems unlikely.
You only need to compare it to the conduct of the delegations following the first round of talks in Geneva to feel the difference in tone. Those talks did indeed yield significant breakthroughs including temporary reductions to most of the tariffs and an agreement to keep talking.
There, the Americans in particular were quick to get in front of the cameras to describe the “substantial progress” with Trump himself extolling “a total reset” in the relationship.
Not so this time.
Instead we have relatively dry statements from both sides about a “framework to implement the consensus” reached at both Geneva and during a phone call between Trump and Xi last week.
Any further description was tepid at best, with China’s official news agency describing the discussions as “candid” a word often used when there has been substantial disagreement.
Read more: Why Trump blinked in US-China trade war
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May: US and China end trade war
High stakes
It’s hard to overstate how high the stakes have become.
What started as a trade war has morphed into a dangerous supply chain war with the potential to wreak deep economic harm.
And by most assessments, it is China that has the upper hand.
Indeed, while the US has introduced a spate of new measures designed to block China’s access to high-tech chips, China has moved to slow and complicate the exports of crucial rare earth minerals to the US.
These metals are absolutely vital in the manufacture of everything from cars to weaponry, and China has the vast majority of the world’s supply.
The new controls have brought some production lines to the brink of standstill, and the West is alarmed.
On the ground here in China you get a sense that while this standoff will cause pain, there is confidence too, particularly in its ability to home grow the type of technology the US is attempting to block.
Indeed, as these talks were ongoing, a branch of the Chinese government was showing foreign journalists around usually hard-to-access high-tech businesses.
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April: US ends zero duty on Chinese goods
A confident China
A controlled and choreographed affair, yes, but an insight too into where government attention and priorities lie and where they are feeling confident.
“We’ve caught up with America in terms of technology and quality,” said Zhou Zhiliang, CEO of GeneMind, a high-tech DNA sequencing and diagnostics company.
“We just need to catch up in terms of the market, building trust in Chinese products and the scale of utilisation.”
Others, when we asked about restrictions imposed by the US, seemed relatively unfazed.
“The trade friction between China and US will have an impact on many industries,” said Zhang Jinhua, founder of IASO Biotechnology, a company specialising in high-tech cell therapies.
“But this is what running a business is like, you always have to face challenges and situations you never expected before, you have to face them.”
And while some moments of candour reveal the frustrations faced by Chinese businesses, the attitude seems to be that none are insurmountable.
“We were selling our products via Amazon, although we now face some problems,” said Yu Kai, co-founder of conversational AI product AISpeech.
“But I believe it can be solved. The current technology dispute doesn’t affect us very much, because we rely on ourselves.”
Indeed, that is the key problem for the US.
China can increasingly rely on itself and is making rapid progress in the development of its own chips and AI technology.
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In contrast, the US is totally beholden to China on rare earths; the development of its own supply would be lengthy and extortionately expensive.
With this upper hand, China will have been driving an exceedingly hard bargain in London.
In an atmosphere of extreme distrust, where neither side will want to be seen to concede, reaching a sustainable truce will be very hard indeed.
The fast-moving developments on Trump’s Ukraine peace deal are dominating the G20 summit in South Africa, as European leaders scramble to put together a counter-proposal to the US-Russia 28-point plan and reinsert Ukraine into these discussions.
European countries are now working up proposals to put to President Trump ahead of his deadline of Thursday to agree a deal.
Ukraine is in a tight spot. It cannot reject Washington outright – it relies on US military support to continue this war – but neither can it accept the terms of a deal that is acutely favourable to Russia, requiring Ukraine to give up territory not even occupied by Moscow and reducing its army.
Overnight, the UK government has reiterated its position that any deal must deliver a “just and lasting peace”.
Ukraine war latest: Kyiv to discuss ending war in talks in Switzerland
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Keir Starmer calls for growth plan at G20
The prime minister, who spoke with E3 allies President Macron of France, Chancellor Merz of Germany and President Zelenskyy of Ukraine on the phone on Friday, is having more conversations today with key partners as they work out how to handle Trump and improve this deal for Ukraine.
One diplomatic source told me allies are being very careful not to criticise Trump or his approach for fear of exacerbating an already delicate situation.
Instead, the prime minister is directing his attacks at Russia.
Read more:
Trump’s 28-point Ukraine peace plan in full
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Prime Minister Keir Starmer attends a plenary session on the first day of the G20 Leaders’ Summit. Pic: Reuters
“There is only one country around the G20 table that is not calling for a ceasefire in Ukraine and one country that is deploying a barrage of drones and missiles to destroy livelihoods and murder innocent civilians,” he said on Friday evening.
“Time and again, Russia pretends to be serious about peace, but its actions never live up to its words.”
Pic: AP
On the Trump plan, the prime minister said allies are meetin on Saturday “to discuss the current proposal on the table, and in support of Trump’s push for peace, look at how we can strengthen this plan for the next phase of negotiations”.
Strengthening the plan really means that they want to rebalance it towards Ukraine’s position and make it tougher on Russia.
“Ukraine has been ready to negotiate for months, while Russia has stalled and continued its murderous rampage. That is why we must all work together with both the US and Ukraine, to secure a just and lasting peace once and for all,” said the prime minister.
“We will continue to coordinate closely with Washington and Kyiv to achieve that. However, we cannot simply wait for peace.
“We must strain every sinew to secure it. We must cut off Putin’s finance flows by ending our reliance on Russian gas. It won’t be easy, but it’s the right thing to do.”
Pic: AP
Europeans hadn’t even seen this deal earlier in the week, in a sign that the US is cutting other allies out of negotiations – for now at least.
Starmer and other European leaders want to get to a position where Ukraine and Europe are at least at the table.
There is some discussion about whether European leaders such as Macron and Meloni might travel to Washington to speak to Trump early next week in order to persuade him of the European and Ukrainian perspective, as leaders did last August following the US-Russian summit in Alaska.
But Sky News understands there are no discussions about the PM travelling to Washington next week ahead of the budget.
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