US-China Tensions Ease Amid Rare Earth Deal, Taiwan Talks

Image Source: Internet

Chinese President Xi Jinping and US President Donald Trump engaged in a phone call to discuss the self-governing island of Taiwan, with Xi emphasizing the importance of Taiwan's return to China as part of the post-World War II international order. This conversation comes on the heels of a recent trade truce between the world's two largest economies, which saw Washington lower tariffs on Chinese goods and Beijing relax restrictions on rare earth exports. The talks, however, have been overshadowed by fresh tensions between China and Japan, a key US ally in the region. In a separate development, the US and China are nearing an agreement on the terms of Beijing's pledge to offer 'general licenses' for the export of rare earths and critical minerals to the US by the end of the month. The two nations have been in negotiations over the past few weeks, with the US already rolling back tariffs and national security measures on rare earth imports. The critical minerals are essential for the manufacture of high-tech electronics, and a shortage earlier this year had threatened production disruptions in industries such as autos, consumer goods, and robotics. The phone call between Xi and Trump also touched on the issue of advanced artificial intelligence chips, with Trump considering whether to allow the sale of more sophisticated Nvidia chips to Beijing. While Trump had previously floated the possibility, some of his advisers have warned that the sale could compromise the US's advantage in the emerging technology. The decision ultimately rests with Trump, who is weighing the opinions of his various advisers, including Commerce Secretary Howard Lutnick.