I have a lot of respect for President Xi,” Donald Trump declared in recent days. “He likes me a lot, I believe, and respects me.” America’s leader is betting on charm and magnetism to win the day when he sees his Chinese counterpart on October 30th in South Korea. It will be the most important political meeting of the year; the men haven’t sat down together since 2019. The markets expect sweetness and light: America’s S&P 500 index of blue-chip stocks closed at a record high on October 27th. Gold has dropped below $4,000 per troy ounce. But any deal announced is very probably a truce—not a treaty.
The past month was rough for the superpowers. On October 9th China imposed sweeping new controls on exports of rare earths, elements essential in manufacturing everything from consumer electronics to military equipment. In response, Mr Trump threatened to slap an additional 100% tariff on Chinese imports from November 1st (on top of the hefty levies already in place). Add to the mix corporate blacklisting, port fees and a spat over soyabeans. That the meeting is happening at all is testament to the weekend work of Scott Bessent, America’s treasury secretary, and He Lifeng, China’s vice-premier, in Malaysia.
Yes, I agree to receive exclusive content, offers and updates to products and services from The Economist Group. I can change these preferences at any time.