Biden and Xi hold first official summit. What's on the agenda?
Nov. 15, 2021 4:13 AM ET iShares China Large-Cap ETF (FXI), KWEB, CQQQ, MCHI ASHR, CHIQ, EWT, GXC, EWH, KBA, CXSE, PGJ, KURE, CHIX By: Yoel Minkoff, SA News Editor 19 Comments
 Lintao Zhang/Getty Images News
The clock is ticking down for a high-profile meeting between President Biden and China's Xi Jinping, which will take place in the U.S. tonight and Tuesday morning in Beijing. While the two leaders have spoken twice by phone since Biden took office in January, today's gathering will resemble a formal bilateral meeting, with leaders on both sides surrounded by high-level aides. The meeting will also take place virtually as Xi has not left China since the pandemic began in March 2020.
Likely topics: Climate change, nuclear nonproliferation, human rights, COVID-19, Hong Kong and Taiwan, intellectual property, cybersecurity and the 2022 Winter Olympics. China's Xi Jinping expected to invite Biden to the Olympic Games.
For investors, any signals that bilateral trade ties are improving may help bolster sentiment. China wants the U.S. to remove Trump-era tariffs, but the Biden administration is expected to keep them mostly in place until Beijing makes good on its promise to uphold several purchase agreements. China has been running far behind its promises made in a "Phase 1" deal signed in 2020 - to boost purchases of U.S. goods by $200B - and has also not fully met promises to improve IP protections and market access for American agricultural products and financial services. How will China's economy respond to Xi Jinping's growing power?
Moreover, the U.S. will raise issues that go beyond the Phase 1 commitments, like China's industrial subsidies for its state-owned companies. Infrastructure could be another hot talking point as China continues to develop its Belt and Road Initiative, which aims to build a series of projects across Asia to Europe. G7 nations have recently sought to counter the effort by launching an international alliance called Build Back Better World, or BBB3.
Outlook: Due to an increasingly fractious relationship, officials on both sides have played down expectations for any concrete conclusions. In other words, while specific issues aren't going to be resolved in the meeting, the U.S. wants to put "guardrails" on the relationship so it doesn't deteriorate. Over the last few months, sweeping crackdowns have also been seen across many of China's economic sectors, showing investors that Xi is willing to force through painful reforms at all costs and making his hold on the Communist Party look even stronger.
Biden and Xi hold first official summit. What's on the agenda? | Seeking Alpha |
