The Sinocism China Newsletter 04.04.17-Will the Trump-Xi “Citrus Summit” Be Sweet or Sour?

I had some tech issues earlier so today’s issue is just commentary, no links.

Presidents Trump and Xi meet in Mar-a-Lago in less than 48 hours. A friend who shall remain anonymous calls it the “citrus summit”, and I am going with that.

Many people, including former government officials with experience dealing with the Chinese, have argued in numerous recent commentaries that it is too early for Trump to meet Xi because the new administration does not have the staffing in place and has not formulated a strategy towards the PRC. They have a point, but I think it is better for them to be talking than not. There are some very talented people in the US government working on US-China relations, from Matt Pottinger at the NSC (The New York Times has a nice profile of him today-A Veteran and China Hand Advises Trump for Xi’s Visit ) to many career folks who frankly were not happy with Obama Administration policies towards Beijing and have long advocated a tougher line.

But the rift in the Trump administration between the globalists like Gary Cohn and Steve Mnuchin and the hardcore America Firsters like Steve Bannon and Peter Navarro, combined with the apparent inability of President Trump to implement any coherent strategy makes it likely that even if the interagency process were to create a “beautiful” strategy towards the PRC the President would ignore it.

Jared Kushner’s role is key, and as Josh Rogin reported in the Washington Post over the weekend in Inside the Kushner channel to China, Kushner has sought the counsel of Henry Kissinger. If Kissinger has significant influence then expect the Chinese to be quite happy. Evan Osnos, clearly not a fan of Kushner, wrote today in Can Trump Match Xi Jinping’s Game that:

“Not in Beijing’s wildest dreams did they imagine a counterpart with Kushner’s characteristics: trusted by the President, overworked, and undertrained. In addition to his China portfolio, Kushner’s assignments include brokering peace in the Middle East and revamping the United States government. His range of responsibility has become a Washington laugh line. (“Gutter clogged? That’s Kushner’s job. Pants chafing you? Kushner’s on it! Dog need a bath? Call Kush!”) China has not assigned a novice to handle the world’s most complex bilateral relationship, but it will not object if America is inclined to do so.”

This initial meeting will likely be a lost opportunity for the US. As to the question of whether the “citrus summit” will be sweet or sour, I expect it will end up being bland. And that would be a victory for Xi Jinping.

One American entity will also register a huge win–Mar-a-Lago. There will be wall-to-wall coverage in Communist Party propaganda outlets of the meeting at the beautiful club. Mar-a-Lago already has at least one Chinese member, as Mike Forsythe reports in today’s As Trump Meets Xi at Mar-a-Lago, There’s a ‘Wild Card’ about Guo Wengui (郭文贵 aka Miles Kwok), a billionaire on the run from Beijing. There may be many more PRC applicants for membership after Friday.

Addendum:

Earlier this evening the White House released the readout of a Background Briefing by Senior Administration Officials on the Visit of President Xi Jinping of the People’s Republic of China. It is worth reading in its entirety but I will highlight key excerpts.

1. On Trade:

The key premise of our economic relationship is that bilateral trade and investment should be mutually beneficial.  However, progress on a range of bilateral economic issues has become increasingly difficult.  This reflects a slowdown and, in certain cases in our view, a retreat in China’s move toward giving the market a more decisive role in the Chinese economy.

Accordingly, there will be significant trade and economic issues to discuss between our Presidents at the summit.  President Trump is very concerned about how the imbalance in our economic relationship affects American workers and wants to address these issues in a candid and productive manner.  President Trump will convey to President Xi the importance of establishing an economic relationship that is fair, balanced, and based on a principle of reciprocity…

As [my colleague] indicated, the primary purpose of the meeting is to set a framework for discussions on trade and investment.  I can’t tell you whether they’re going to get into specific issues to resolve at this time or to be on the agenda for discussion and hopefully early resolution in the weeks and months ahead.  But this is the introductory meeting to put a framework in place for how we’re going to discuss and address these matters…

I just want to clarify, I did not say that they would not be talking about tariffs.  We haven’t scripted out what they will be talking about.  I don’t anticipate there will be a resolution on those issues, but they’ll be both establishing a framework for discussing the matters, and I am sure that each side will raise particular issues.

But I would not anticipate we’re going to be at the point of resolving those issues in this one-day set of meetings.

2. On North Korea:

North Korea clearly is a matter of urgent interest for the President and the administration as a whole.  I think the President has been pretty clear in messaging how important it is for China to coordinate with the United States and for China to begin exerting its considerable economic leverage to bring about a peaceful resolution to that problem.

So certainly it is going to come up in their discussions.  Somewhere on the order of just shy of 90 percent of North Korea’s external trade is with China, so even though we hear sometimes that China’s political influence may have diminished with North Korea, clearly its economic leverage has not.  It is considerable.  And so that will be one of the points of discussion…

I can tell you that it is now urgent because we feel that the clock is very, very quickly running out.  And again, we would have loved to see North Korea join the community of nations.  They’ve been given that opportunity over the course of different dialogues and offers over the course of four administrations, with some of our best diplomats and statesmen doing the best they could to bring about a resolution.  The clock has now run out, and all options are on the table for us.

[Editor: Kim Jong Un shot off a medium-range ballistic missile earlier today, according to PACOM.  What happens if he tests another nuclear weapon or more missiles during the meeting? Such a move would demonstrate so much contempt for the PRC and Xi Jinping personally that Xi would have a hard time not responding. ]

3. On the South China Sea:

We will — there will be an opportunity for the two leaders to discuss that.  There’s nothing that I would state in addition to what I’ve already said, but it’s no secret that the President was disturbed by activities that took place under the last administration.  And he and his Cabinet members have been on the record as saying that that has got to stop.

4. On Taiwan:

Q: President Xi reportedly wants to hear President Trump officially recognize Taiwan as a province of China.  What will his message be on that and on the South China Sea?

SENIOR ADMINISTRATION OFFICIAL:  Well, the President has reaffirmed our adherence to the one-China policy — that is our one-China policy that’s based on the three joint communiques with China, as well as the Taiwan Relations Act.  That is longstanding policy of the United States; that is a policy that the President has reaffirmed.  So I don’t anticipate some kind of surprising deviation from that.

5. On the existing mechanisms for dialogue. [Editor: It sounds like there will be some changes, including to the increasingly unwieldy US-China Strategic and Economic Dialogue]:

I do think that there is going to be some movement toward a framework for dialogues that will be elevated from some of the previous or preexisting dialogues that have existed with prior administrations, and for those dialogues to be streamlined and for there to be clear deadlines for achieving results.

6. On Golf:

I think it’s safe to say there’s not going to be any golf — (laughter) — and there will be — the First Ladies are both going to be there.  There will be time, particularly in the first day, for them to get to know one another in a more informal kind of interaction as well as a dinner.

The next day will be a series of meetings up to and including a working lunch.  And it’s possible that they’ll walk around a bit, as the mood strikes, but nothing formal or nothing involving golf clubs.

7. On Human Rights:

Q: Yes. And the other, religious persecution in China, which many of the President’s supporters in the last campaign had hoped he would bring up when he engaged the Chinese.  Are you either going to be brought up?

SENIOR ADMINISTRATION OFFICIAL:  And again, I’m not going to pre-speak the President’s talking points.  We’ll see what is concretely discussed, but human rights are integral to who we are as Americans.  It is the reason that we have alliances at the end of the day, one of the reasons in addition to the fact that they serve our security and prosperity here at home.  And human rights issues I would expect will continue to be brought up in the relationship.

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