Since Trump recklessly started a global trade war with his economically illiterate policies, understandably most attention has gone to tariffs and other trade measures. The US-China trade negotiations in Geneva and London make clear that both sides are hurting. It is not clear who will get ahead in the stand-off between Chinese export dependency and US reliance on rare earth imports. However, the curious appearance of Taiwan in Chinese material raises questions.
After Donald Trump returned to the White House, some commentators worried that his simplistic world view and authoritarian sympathies would make him likely to seek grand bargains with Vladimir Putin and Xi Jinping over Ukraine and Taiwan. Now it appears global panic about rare earth shortages has helped Beijing discovered the strength of its leverage. Strikingly, next to demands on recent US tech restrictions, Chinese readouts since the Xi-Trump phone call now also include warnings on Taiwan policy.
The Chinese side has warned the Trump administration about the Taiwan ‘red line’ for longer. The removal from the US State Department website that the US ‘does not support’ Taiwanese independence was a big trigger. However, several mentions in the context of the trade war stand out.
The Chinese read-out of the 5 June phone call between Xi Jinping and Donald Trump has a separate paragraph on Taiwan:
President Xi emphasized that the United States must handle the Taiwan question with prudence, so that the fringe separatists bent on “Taiwan independence” will not be able to drag China and America into the dangerous terrain of confrontation and even conflict.
In Chinese diplomatic practice, the pronouncements of the highest leader indicate the direction. Dialogues, talks, and ‘consensus’ reached between two leaders are the touch stone Chinese diplomats always come back to in bilateral relations. So also with this call.
The CCTV-linked social media account Yuyuan Tan Tian 玉渊谭天 – used in previous trade war signalling – published a piece on 6 June taking apart the Xi-Trump phone call line by line. For the Taiwan line, it stresses the appearance of this topic in a trade call signals its weight. The key phrase, YYTT says, is ‘handle the Taiwan question with prudence’ (慎重处理台湾问题). It again repeats Chinese complaints about the State Department webpage change. It interprets Trump’s words in the Chinese readout shows a three-facetted consensus, one of which is the One China Principle (sic) and respect for China as the political foundation of the bilateral relationship (一是重申“一个中国原则”与对华尊重 ，这是中美关系的政治基础。).
Xi’s language flowing from the top is repeated elsewhere, for example in the Zhong Sheng commentary in People’s Daily of 7 June. For good measure, China’s Taiwan Affairs Office drew attention during its 11 June regular press conference to Xi Jinping’s Taiwan line in the Trump phone call that Washington must ‘handle the Taiwan question with prudence’. All of the above points to the danger of support for ‘separatists’, indicating the unhappiness with the State Department webpage update. US behaviour related to Taiwan is now a fixed part of the Chinese language in the trade negotiations.
Of course, Taiwan has always been a sticking point for Beijing. Mentioning it does not mean China will demand or get outright concessions from Washington on the US One China policy. However, the weakened US position in the face of rare earth blockages harming Western industry has already led to suggestions of concessions on tech restrictions. Given how little Trump has indicated he cares or understands about Taiwan, this might be an area where he could concede more easily. Beijing has never been satisfied with the US stating it ‘does not support Taiwanese independence’. Will it want the State Department to state Washington ‘opposes Taiwanese independence’ as a concession?
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