Decoding Trump-Xi

If it feels like Donald Trump and Xi Jinping just had a meeting, you’re not wrong. It’s their third in less than a year. But every time the leaders of two superpowers get together, it’s a big deal, and today’s meeting at the White House is a state visit. Lots of pageantry. Will there be substance? We’ll see.

Today’s newsletter is a guide to the Trump-Xi meeting.

How to understand Trump-Xi

Who is going into this visit with the upper hand?

Probably Xi.

Trump is facing a midterm election in which his party is far behind in polls and he is stuck in a war that voters don’t like. Xi, as our China correspondent David Pierson explains, is gearing up for a “norm-shattering fourth term as head of the ruling Communist Party.” He’s going to be in power for at least another five years.

Trump and Xi face very different political realities. Trump really doesn’t want a trade fight before an election. The Chinese economy may be struggling — but Xi doesn’t answer to an electorate.

What should we expect to come out of the state visit?

For all the pageantry that typically surrounds Trump-Xi meetings, they don’t produce much.

David again: “Xi appears to have calculated that the best way to manage the United States is to engage Trump in high-profile summits rich in optics but thin in substance.”

Expectations are low for breakthroughs on anything significant like A.I. safety or Chinese trade imbalances. But maybe China will agree to buy more U.S. agricultural products, like it did last time. (Xi promised in May to buy more U.S. farm goods, but that hasn’t happened.)

There’s currently a trade war truce. Is it holding?

More or less. But that doesn’t mean that relations have been without conflict.

Scott Bessent, the U.S. Treasury secretary, has described the relationship as “a water polo match” in which leaders are basically following the rules. But under the surface, he said, China was doing “a lot of kicking,” and “if we have to, we’ll kick back.” An editorial in a Chinese state-run newspaper called that a “perfect metaphor,” but it said it was the United States that was doing the kicking.

Among the flash points, according to my colleague Ana Swanson, who covers trade: China is unhappy about U.S. bans on importing Chinese cars and humanoid robots. The U.S. is unhappy about those unfulfilled farm goods promises. China wants more access to the powerful chips required for cutting-edge A.I. models — part of the two countries’ ongoing race to control the future of that technology. And, of course, China’s control of rare earths is still looming over the relationship.

How did China get to the point where it could compete with the U.S. on A.I. in the first place?

Through lots and lots of government spending. My colleague Vivian Wang has a big story on this, well worth reading in full. Basically, 10 years ago, Xi began a push to turn China into the world’s dominant producer of A.I., a place where artificial intelligence permeates daily life. “To realize that vision,” Vivian writes, “the Chinese government is mobilizing the full weight of the state.”

In contrast to the A.I. industry in the U.S., which has been funded by hundreds of billions of dollars in private investment, “economists estimate that Chinese state-led funds put more than $184 billion into A.I. firms between 2000 and 2023, and last year, the government and state-owned banks pledged hundreds of billions more.”

That has put China in a competitive position in the A.I. race. (Take a look at where the U.S. has the upper hand on A.I. and where it’s lagging behind China.) The spending might, however, be having consequences for the broader Chinese economy, which is looking weaker than it has in decades, as my colleague Li Yuan writes. As the government pours money into A.I., it isn’t doing enough to boost employment or consumption, economists say.

Watch David Sanger, our White House and national security correspondent, explain in the video below how the U.S. and China can contain their A.I. race.

And how does Taiwan fit into all this?

As one analyst recently told my colleagues: “There’s only one issue that could cause relations between both sides to break down completely or erupt in conflict, and that is Taiwan.” China has long claimed the self-governed island as its territory, and Taiwan relies heavily on U.S. military power to ward off the threat from Beijing.

Analysts expect Xi to try to persuade Trump to keep delaying $14 billion in proposed U.S. arms sales to Taiwan, a deal that Trump has described as “a very good negotiating chip.”

What might this chip be used to bargain for? Trump might want China to increase pressure on Iran to reopen the Strait of Hormuz. Meanwhile, Taiwan just surpassed China as the third-largest source of U.S. imports, behind Mexico and Canada, according to U.S. figures. The bulk of those imports are — as you might have guessed — semiconductors and other technologies related to A.I.

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Tirokafteri is a tangy, silky Greek dip with feta and roasted red peppers. It’s only mildly spicy, but if you’re sensitive to heat, start with half the chile and then add more to taste.