Biden, Xi Seek Stability in San Francisco Summit

A meeting this week between President Joe Biden and Chinese President Xi Jinping at the Asia-Pacific Economic Cooperation summit is likely to yield some practical—if small—gains in the troubled U.S.-China relationship. But while it’s imperative that the leaders of the two most powerful countries in the world talk to each other, and such a conversation could set the stage for progress down the road, big, immediate gains from the meeting are unlikely.

‘Significant and Substantial Differences’

The face-to-face meeting between the two leaders, the first in a year, comes at a moment of stress in the international system as Russia’s war in Ukraine grinds on, the U.S. confronts a dangerous conflict in the Middle East between Israel and Hamas and tensions between China and the U.S. and its allies in the Indo-Pacific continue to rise. This context leaves little room for resolving the big friction points between the U.S. and China over tough economic and trade issues, Taiwan’s political future, Beijing’s militarization of the South China Sea and North Korea’s nuclear weapons.

As a result, expectations for outcomes from the meeting are modest even as the importance of engagement between Washington and Beijing rises. Restoring leadership-level and military-to-military communications, cooperating on the battle against fentanyl and addressing climate change are likely. These pursuits are definitely helpful, particularly the military exchanges that could lead to a reduction in the number of risky encounters between U.S. and Chinese ships and airplanes.

As Ja Ian Chong, associate professor of political science at National University of Singapore, has observed, “there remain significant and substantial differences between the United States and PRC. You can see this in technology as well as over issues like military activity and PRC territorial claims.” While a breakthrough in relations seems like a very high hurdle, Chong continued, “a meeting between Biden and Xi would be useful to give more momentum to high-level meetings over economics and foreign policy that have been taking place. Building such contact could help avoid a degree of miscalculation by both sides and perhaps pave the way for more stability in the trans-Pacific relationship.”

On the Agenda

Given the high stakes and the sizable challenges in the U.S.-China relationship, it would be easy to overplay the significance of the Biden-Xi meeting. It is the culmination of a year of difficult engagement by U.S. diplomats. Indeed, the meeting is not a state visit but rather a consequence of the fact the U.S. is hosting APEC this year. It would be not just unfortunate but profoundly counterproductive for both Biden and Xi, as leaders of APEC’s two biggest economies, not to privately meet at the conference.

Even so, the Biden-Xi meeting has the potential to set the stage for a broader reduction in tensions between the U.S. and China. Xi faces economic troubles at home with high youth unemployment, a slowing economy and a bankrupt real-estate sector. Biden is heading into an election year and needs China’s help to keep the war in both Ukraine and Israel-Gaza from escalating. “The president will underscore our desire for China to make clear, in its burgeoning relationship with Iran that it is essential that Iran not seek to escalate or spread violence in the Middle East and to warn, quite clearly, that if Iran undertakes provocative actions anywhere that the United States is prepared to respond and respond promptly,” a senior administration official told reporters at the White House last week.

At the same time, the prospect of a future conflict over Taiwan or the South China Sea remains real and troubling. Taiwan’s upcoming presidential elections in January and Beijing’s concerns about U.S. support for the island nation’s independence likely will be at the front of Xi’s agenda in San Francisco.

Taiwan’s Election

Taiwan will hold its presidential elections on January 13. Four candidates are vying to replace outgoing President Tsai Ing-wen of the Democratic Progressive Party (DPP). Polls show DPP Vice President Lai Ching-te, who advocates Taiwan’s continuing separation from China, in the lead. Lai’s top opponent Kuomintang Party nominee and New Taipei Mayor Hou Yu-ih is seen as friendlier toward Beijing.

With two months to go before the election, Xi is expected to press Biden for some kind of U.S. statement reaffirming the “One China” doctrine and not supporting Taiwan’s independence. When Lai visited the U.S. in August, the Biden administration was careful not to do or say anything that might be interpreted as backing him in the election or taking sides in Taiwan’s domestic politics around relations with China.

Behind closed doors, Xi is likely to challenge Biden over U.S. arms transfers to Taiwan, which have been accelerating with strong U.S. congressional backing. Biden is sending Taiwan up to $500 million in military aid this year and, according to the Defense Security Cooperation Agency, has approved more than $4.4 billion in weapons sales over the past three years.

Technology Controls

Xi is also expected to use the meeting with Biden to voice Beijing’s concerns over the U.S.’s imposition of export and investment controls aimed at blocking China’s access to advanced semiconductors and artificial intelligence technology as well as financing for technology ventures.

U.S. exports of semiconductor chips and components to China fell to $11.2 billion in 2022, down from $14.2 billion in 2021 following the Biden administration’s imposition of controls in October 2022. Those numbers have fallen further in 2023. Meanwhile, China is retaliating with curbs on sales by U.S. companies and restrictions on supply of critical minerals.

“It’s clear that they’re coming to understand that the Biden administration is pursuing a path that is probably even more aggressive than the Trump administration’s in terms of its sophistication, breadth, and scope of some of the technology restrictions that they’ve been applying to China,” said Jude Blanchette, Freeman Chair in China Studies at the Center for Strategic and International Studies (CSIS), said in a CSIS media briefing earlier this month. “Beijing sees the upcoming meeting as an opportunity to try to shift the trajectory, or at least find ways to put brakes on the pace of U.S. actions.”

Strained Diplomacy

U.S. and Chinese relations, already strained by a trade war under former President Donald Trump’s administration, worsened in July 2022 when then-Speaker Nancy Pelosi visited Taiwan. In Taipei, Pelosi expressed congressional support for arming Taiwan against a potential future Chinese invasion. An angered Beijing responded by shutting down military-to-military dialogue and climate-change talks.

Xi and Biden met face-to-face in November last year in Bali, Indonesia, on the sidelines of the G20 summit. It was the first meeting between the two leaders since Biden became president. Afterward, Biden described their three-and-a-half hour meeting as “open and candid” and “very blunt,” covering “a lot of territory.” “We’re going to compete vigorously,” Biden said in Bali. “But I’m not looking for conflict. I’m looking to manage this competition responsibly.” Chinese state media reported that Xi viewed the meeting as “an important opportunity for the two sides to jointly steer the deeply troubled bilateral relationship out of the current predicament.”

But Xi blamed the U.S. for the shutdown in communication between the two sides and warned Biden that Taiwan was Beijing’s “first red line.” He rejected some U.S. politicians’ narrative of “democracy versus authoritarianism” as a “scheme to stir up ideological confrontation” in the U.S.-China relationship.

Importantly, Xi and Biden agreed in Bali to try to improve communications between the two countries at the ministerial level. Secretary of State Antony Blinken was tasked with a future visit to Beijing to make that happen. Unfortunately, this initiative stalled after a 200-foot-high Chinese spy balloon carrying an aerial vehicle the size of a jetliner floated over the continental U.S. in early February 2023.

Blinken postponed his planned trip, and Biden directed the U.S. military to shoot down the balloon. Beijing accused the U.S. of overreacting. The following month, speaking to a committee of the National People’s Congress, Xi lambasted the U.S. and its Western allies for what he said was a strategy of “containment, encirclement and suppression” of China’s development.

Shifting Tone

But by April this year, U.S. officials began asking for more communication with Chinese counterparts, and the administration adopted the rhetoric of “de-risking” not “decoupling” to explain U.S. trade policy. U.S. officials sought to emphasize that most trade with China does not invoke national-security concerns. Indeed, the U.S. imported $537 billion worth of goods from China and exported $154 billion in 2022, according to U.S. Commerce Department data.

In June, Secretary Blinken’s trip was rescheduled, and CIA Director Bill Burns, Treasury Secretary Janet Yellen, Climate Envoy John Kerry and Commerce Secretary Gina Raimondo all visited China on separate occasions for talks. The same month, Biden suggested U.S. alliance building in the Asia-Pacific had matched China’s growing influence in the region. Facing economic trouble, Xi wanted a renewed relationship with the U.S., Biden said, suggesting that the U.S. was in a strong position. “Things are changing,” Biden said in remarks at a private fundraiser in California. “We put together in Southeast Asia—and, by the way, I promise you we’re going to—don’t worry about China. I mean, worry about China, but don’t worry about China.”

Lately, Chinese officials and state-run media have been setting a new tone in public comments about the U.S.-China relationship. In Beijing, Xi offered conciliatory words in a meeting with U.S. senators in early October, according to a Xinhua report. China maintains that the common interests of the two countries far outweigh their differences, and the respective success of China and the U.S. is an opportunity rather than a challenge, Xi reportedly said.

U.S.-China communications have been fairly open of late. China’s top diplomat Wang Yi visited Washington at the end of October. He met for an hour with Biden at the White House, held two rounds of formal talks with Blinken at the State Department and met with National Security Adviser Jake Sullivan. Meanwhile, China’s Vice Premier He Lifeng was in San Francisco for two days of meetings with Secretary Yellen ahead of the APEC summit. In a Washington Post op-ed, Yellen wrote that the U.S. and China “have an obligation to establish resilient lines of open communication and to prevent our disagreements from spiraling into conflict.”

In early November, China’s Vice President Han Zheng said at a business forum in Singapore that the string of cabinet-level meetings between U.S. and Chinese officials had improved relations. The talks “have sent out positive signals and raised the expectations of the international community on the improvement of China-U.S. relations,” Han said.

Economic Stability

The Biden-Xi meeting in San Francisco “is going to be very businesslike, very hardnosed, a lot on the agenda that they’re both going to be trying to work through,” said Victor Cha, senior vice president for Asia at CSIS. “Talking is better than not talking.” Biden and Xi know each other well, having met in person many times since 2011 when Biden was vice president and Xi emerged as China’s next leader. That personal relationship will help both sides navigate the complex and difficult issues confronting their nations.

Additionally, the wider economic context of the meeting, happening during an APEC summit, provides some stabilizing influence. Seven of the U.S.’s top 10 trading partners—Canada, Mexico, China, Japan, South Korea, Vietnam and Taiwan—are APEC members, reflecting the importance of the Asia-Pacific region to the U.S. and the North American economy.

The U.S.-China bilateral trade relationship, however, has weakened after growing steadily for decades, according to the U.S.-China Business Council. Stunted post-pandemic growth in China, Russia’s war in Ukraine and U.S.-China tensions are weighing on the relationship.

Xi will also meet with U.S. CEOs while in San Francisco as he bids to reassure business leaders of China’s openness to trade and investment. China’s economy has rebounded slowly from the COVID-19 pandemic while regulatory crackdowns and geopolitical tensions have spooked foreign investors.

While some in Congress have criticized the Biden administration for its “zombie diplomacy” with China, as geopolitical threats rise it is more important than ever that U.S. and Chinese leaders can meet and exchange views frankly and candidly. Even small tactical gains now can lead to improvements in relations over time. If 10 years from now China and the U.S. have not gone to war, people would be able to look back at today’s diplomacy as part of a strategic success.