Settle in, everybody: The weekly recap

Here’s a question we at Trivium have been pondering quite a bit lately:

• What are the real prospects for a meeting between Xi Jinping and Donald Trump in the coming months?      

Over the past few weeks, there have been conflicting reports over whether and when a meet-up might take place.

• On March 17, Donald Trump himself indicated that Xi will visit DC "in the not-too-distant future."
• Meanwhile, White House sources have told the FT that there have been “no discussions about such a meeting.”

The more we think about it, there seem to be some real obstacles to getting Trump and Xi into the same room.

The main issue, as we understand it, is that the Chinese side prefers to work bottom-up on things like this by:

• First, laying plenty of groundwork through lower-level official meetings to resolve as many issues as possible
• Then, escalating to minister-level dialogues, where key principals can tackle the tougher negotiations
• Finally, only after this process has run its course, bringing in the heads of state to sign a deal, shake hands, and pose for photos

It’s worth noting that this is standard diplomatic protocol pretty much anywhere.

But it probably goes without saying that Donald Trump isn’t one to follow standard protocol – and he prefers to handle negotiations himself.

• Indeed, Trump’s preference is to talk things through directly with Xi, and only then let lower-level officials work out the fine print.
• So…pretty much the opposite of China’s approach.

From what we understand, this mismatch in approaches is creating major hurdles to setting up a Xi-Trump tête-à-tête.

It’s understandable that China would be reluctant to go along with Trump’s approach.

• Having Xi walk into a freewheeling, face-to-face discussion with Trump to hash out a grand bargain could spin out in all sorts of directions.
• Just ask Volodymyr Zelenskyy.

The best possible solution – as we discuss in this week’s podcast – may be for Trump and Xi to start with a lower-stakes “get to know you (again)” call, where they both clearly designate deputies authorized to speak on their behalf and get negotiations going in earnest.

• On the Chinese side, it’s pretty obvious that this deputy would be Vice Premier He Lifeng.
• On the US side, though, it’s unclear exactly which cabinet official – or other individual – Trump might be willing to entrust with such a momentous task.

Until something gives, though, we think a Xi-Trump meeting remains more of a challenge – and more of a distant prospect – than is widely assumed.

Could all these wrinkles be ironed out over the next 2.5 months – in time for a mid-June birthday summit between the two leaders?

• Maybe. But from what we are seeing right now, that’s about the fastest realistic timeline on the table.
• If we had to bet, our money would be on a meeting later in the summer – or even into the fall.

And if we’re right about that, everyone might as well just settle in and get comfortable.

• The latest chapter of the US-China tech and trade war is going to be a long one.

Andrew Polk, Co-founder, Trivium China

What you missed

Econ and finance

Beijing is reportedly mulling whether to extend its consumer goods subsidies to cover the purchase of services, as well.

• The State Council launched the consumer goods trade-in program in March 2024, subsidizing purchases of big-ticket items like autos and home appliances.
• In 2025, the program was expanded to include consumer electronics, and central government funding was also doubled to RMB 300 billion.
• The FT now reports that “there is a serious discussion about a services subsidy program.”

Tech

At the annual Zhongguancun Forum on tech and innovation on Thursday, cyberspace administration (CAC) Deputy Director Wang Jingtao promised more experimentation on cross-border data transfers.

• The central bank (PBoC) and industrial ministry (MIIT) are formulating data export guidelines specifically for the finance and auto industries; the Ministry of Commerce (MofCom) is working on a data export security assessment “green channel” for foreign-invested enterprises
• Wang also said that the CAC would support “all localities” to explore innovative data export management measures.

Business environment

On Friday, Xi Jinping met with over 40 foreign business executives in Beijing – one of the largest gatherings of foreign business leaders Xi has ever hosted.

• Xi also brought his A-team to the meeting, including: Cai Qi, the fifth-ranking Party official and Xi’s chief of staff; Vice Premier He Lifeng, who oversees foreign investment; Top diplomat Wang Yi.
• By calling in the big guns – i.e. Xi himself plus other top officials – Xi has signaled that MNCs are still highly valued in China’s economy.

On Sunday, Premier Li Qiang delivered opening remarks at the China Development Forum (CDF).

• Held annually since 2000, the CDF is China’s top forum connecting foreign executives directly with senior Chinese officials to discuss trade and investment. This year, top executives from 86 multinational companies attended the forum – a slight decline from 2024.
• Li called for more foreign investment in China, saying “we welcome more foreign companies to invest in and deepen their presence in China.”

Corporates

BYD is pushing ahead with its aggressive international growth strategy amid strong geopolitical headwinds.

• On its Tuesday earnings call, the company announced plans to nearly double overseas sales to 800,000 units in 2025 – up from 417,204 units last year.
• BYD signaled it will continue to pursue a dual strategy of exports and localized production and sales.

US-China

On Tuesday, the US Commerce Department’s Bureau of Industry and Security added over 70 Chinese entities to the Entity List.

• That includes 11 Chinese firms and institutions which are “engaging in the development of advanced AI, supercomputers, and high-performance AI chips for China-based end-users with close ties to the country’s military-industrial complex.”
• Among these are subsidiaries of computer-maker Inspur, and the Beijing Academy of Artificial Intelligence, a non-profit AI research group releasing open source models.

On Monday, the State Council issued 22 new regulations to beef up China’s Anti-Foreign Sanctions Law (AFSL).

• China passed the AFSL in 2021 as part of a larger effort to build a legal framework to strike back against foreign (read: American) economic coercion.
• The new regs strengthen enforceability of China’s existing counter-sanctions toolkit by clarifying the law’s scope and prohibited activities. They also specify a clearer division of labor for departments overseeing the law’s enforcement.

As always, it was a busy week in China.

• Thank goodness Trivium China is here to make sure you don’t miss any of the developments that matter.