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Donald Trump's transactional approach will suit Xi Jinping(Interview)

Financial Review(《澳大利亚金融时报》) 2017-11-08

President Donald Trump has a clear agenda for his trip to China and it's all about trade and investment. Look no further than the dozens of US executives who make up the business delegation accompanying the president on his first visit to Beijing, or the flurry of speculation about the multi-billion dollar deals that will be done.

Focusing on the economic relationship allows Mr.Trump to appear proactive in addressing the trade imbalances he made a central plank of his election campaign. He has already called out Japan for its unfair trade practices and clearly flagged China, the third stop on his Asian tour, was next.

"The problem we have with China is that for decades . . . it's been a very unfair trade situation," Mr Trump said in a press conference in Tokyo on Monday.

"Our trade deficit is massive," he said. "We've already started discussions with China because it has to come down."

Mr.Trump was in Seoul on Tuesday, where he lunched with troops before receiving an operational briefing. The situation in North Korea was expected to dominate his afternoon meeting with Mr Moon.

He will arrive in Beijing on Wednesday and is looking for concrete results from his China trip. Beijing appears happy to oblige the US president, who prides himself on his deal-making acumen. Already, there are reports Chinese sovereign wealth fund, China Investment Corp, will announce a multi-billion dollar partnership with Goldman Sachs to invest in US manufacturing. At the same time, China Petroleum & Chemical Corporation, better known as Sinopec, is said to be mulling an investment in a Texas oil pipeline and an expansion of an oil storage facility in the US Virgin Islands.

This narrow focus on business and trade also allows Trump to avoid some of the thornier issues in the relationship.

"Trade and business are what Trump cares about because he can tell his domestic supporters he brought back some big presents back from China," said Wu Xinbo, director of Fudan University's Centre for American Studies in Shanghai.

"This story is easy to tell and the results are tangible."

Mr.Trump's answer to a question this week on how the US can be a "force for freedom and openness in this region without inevitably coming into conflict with China" was telling.

"As far as China is concerned, my relationship, as you know, with President Xi is also excellent," he said.

"I like him a lot. I consider him a friend. He considers me a friend. With that being said, he represents China; I represent the United States. His views are different on things, but they're pretty similar on trade."

The tactic for Trump appears to be elevating the personal connections with his regional counterparts to deflect from the significant geopolitical uncertainties in the region. So far on his Asia tour he has labelled South Korea's Mr Moon "a fine gentleman" and said of Shinzo Abe's victory in the recent Japanese election: "You won very big and very easily and I'm not surprised."

This foreign policy approach will probably suit China, allowing Beijing to present a stable diplomatic relationship to reassure a domestic audience while back-channelling concerns about US "meddling" in the region rather than airing them publicly.

"Mr.Trump's policy on China is quite clear; it's about practical cooperation," said Mr Wu. "This attracts some criticism in the US because some people want Washington to contain China."

However, it's hard to ignore the new language emanating from the White House. Mr Trump has repeatedly referred to the "Indo-Pacific" rather than the "Asia-Pacific", in what appears to be a deliberate and coordinated strategy to downplay China's role and influence by expanding the regional reference to include India.

This type of language will only fuel China's concerns about a revival of the controversial US-Australia-India-Japan "Quadrilateral Security Dialogue". The four countries are expected to discuss the security grouping on the sidelines of the Asia-Pacific Economic Cooperation meeting later this week.

Given the strong focus on trade and investment in China, it is also unclear whether Mr Trump would push for the release of poet and artist Liu Xia, who has been under unofficial house arrest since 2010, when her late husband Liu Xiaobo was awarded the Nobel Peace Prize.

Mr Liu, who had been serving an 11-year sentence for inciting subversion of state power after helping to write a manifesto calling for freedom of expression and human rights, died earlier this year.