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WASHINGTON – As President Trump prepares for his upcoming visit to China, looming tensions in Iran are casting a shadow over the trip. The U.S. is hoping to secure assistance from Chinese President Xi Jinping to help reduce gas prices domestically, which might involve negotiating compromises in the ongoing technology dispute between the two nations.
China’s own economy is under pressure as well, grappling with rising gas prices and manufacturing slowdowns that are dampening export demand.
One potential strategy for President Trump is to encourage China to tap into its vast strategic oil reserve, which contains approximately 1.4 billion barrels. However, such a request might prompt Xi to seek concessions from the U.S., specifically regarding the relaxation of restrictions on American technology, particularly in artificial intelligence.
The United States has been actively working to hinder China’s progress in developing advanced semiconductor chips, a sore point for Beijing as both nations remain entrenched in a technology standoff. Notably, U.S. tech industry titans, including leaders from NVIDIA, Apple, Exxon, Boeing, Qualcomm, Blackstone, Citigroup, and Visa, are expected to accompany Trump on his visit, according to a report from Semafor.
Michael Clark, a China expert at the Center for American Progress, anticipates that Xi will likely push for easing AI chip restrictions in exchange for cooperating with Trump’s oil-related requests. Clark suggests that Beijing views this as a potential strategic advantage, willing to endure some immediate setbacks for potential long-term benefits.
“We’d be giving China exactly what they need to upgrade their own technology, and in turn military capabilities, using US technology,” he told The Post. “If China can trade a bit of oil, which they can replace with Russian imports, in exchange for permanent know-how and IP, I’d say they would go for it.”
There’s long been worry from the Americans that China is trying to steal American technology – including AI models and AI chips – to advance their own technological growth while protecting their own technological advances.
But tech companies see China as an untapped market for their goods. NVIDIA CEO Jensen Huang has estimated the China market could be worth $50 billion annually.
The White House cautioned that until the business delegation list is finalized, reporting on CEOs invited to China should be treated “as baseless speculation.”
There are other points of contention, including Beijing ordering its companies to disregard US sanctions targeting Iranian oil.
China is Iran’s biggest customer when it comes to crude oil and the Trump administration has pushed its leaders to use their influence in Tehran to help open the critical Strait of Hormuz.
Beijing has been cautious about its level of involvement in the war talks as its leaders watch and wait to see what happens.
But, despite the differences, experts believe both sides recognize a stable, open relationship is better in the long run.
“The two sides are pretty invested in not allowing this to destabilize the broader relationship,” Brookings Institute’s Patricia Kim told reporters at a briefing Thursday, adding Washington and Beijing both want to keep a “managed detente.”
The president’s visit to Beijing next week will be the first by a US president in eight years. Originally scheduled for April, the president delayed it because of the war in Iran.
For China, there are some positives in Trump’s war efforts.
The president’s focus on the Middle East keeps his attention and American resources in that region of the world instead of the Indo-Pacific, which China sees as its sphere of influence.
The conflict also has opened up opportunities for China with other Gulf nations, expanding its foothold in the region and giving it a broader base of countries to purchase its oil.
Xi has met with Abu Dhabi’s crown prince, Sheikh Khaled bin Mohamed bin Zayed Al Nahyan, and spoken with Saudi Crown Prince Mohammed bin Salman about the conflict as China sought to deepen its relationships around the Middle East.
Then there are China’s own priorities for next week’s meeting, at the top of which is Taiwan.
Xi wants to redefine Taiwan’s legal status and demand the US stop supporting Taiwan independence. In his New Year’s speech, he vowed to take the island and called reunification “unstoppable.”
Economic policy is also a major theme of the two-day meeting.
One of the original goals of this summit was to manage the trade imbalance between the two sides.
The US would like to see China buy more of its goods, including soybeans and airplanes, to decrease its trade surplus. Beijing would like to avoid any additional tariffs from Trump.