LITTLE LIKELYHOOD OF SUBSTANTIAL BREAKTHROUGH
Trade experts said there was little likelihood of a substantial breakthrough in the talks hosted by Spain’s Socialist Prime Minister Pedro Sanchez, who has sought to improve ties with Beijing in recent years.
The most likely result of the Madrid talks is seen as another extension of a deadline for the popular TikTok app’s Chinese owner, ByteDance, to divest its US operations by Sep 17 or face a US shutdown.
A source familiar with the Trump administration’s discussions on TikTok’s future said that a deal was not expected, but that the deadline would be extended for a fourth time since Trump took office in January. Trump last month launched a TikTok account.
TikTok has not been discussed in previous rounds of US-China trade talks in Geneva, London, and Stockholm. But the source said the issue’s public inclusion as an agenda item on the Treasury’s announcement of the talks gives the Trump administration political cover for another extension, which may annoy both Republicans and Democrats in Congress who mandated TikTok’s sale to a US entity to reduce national security risks.
Wendy Cutler, a former USTR trade negotiator and head of the Asia Society Policy Institute in Washington, said she expected more substantial “deliverables” to be saved for a potential meeting between Trump and Chinese President Xi Jinping later this year, perhaps at an Asia Pacific Economic Cooperation summit in Seoul at the end of October.
These may include a final deal to resolve US national security concerns over TikTok, and a lifting of restrictions on Chinese purchases of American soybeans and reduction of fentanyl-related tariffs on Chinese goods, and the Madrid discussions may help lay groundwork for such a meeting, Cutler said.
But she said resolving core US economic complaints about China, including its demands that China shift its economic model toward more domestic consumption and rely less on state-subsidized exports, could take years.
“Frankly, I don’t think China is in any rush to do an agreement where they don’t get substantial concessions on export controls and lower tariffs, which are their key priorities,” Cutler said. “And I don’t see the United States in a position to make major concessions on either, unless there’s some breakthrough on its demands to China.”
