US President's Softer Trade Stance Divides Advisors

Sources indicate that the US president's less aggressive approach to trade is creating divisions among his advisors. Some advisors are advocating for a more forceful stance towards Beijing.

The president has softened his previous combative rhetoric towards China, reportedly to increase the likelihood of a meeting with his Chinese counterpart and to finalize a trade agreement with China. A summit between the two leaders seems probable following a recent meeting between the US Secretary of State and the Chinese Foreign Minister, which both sides characterized as positive and constructive.

The president now appears more focused on securing purchase agreements and achieving immediate successes, rather than addressing the underlying causes of trade imbalances. This shift contrasts with his earlier approach, which prioritized reducing the US trade deficit through the implementation of tariffs. This earlier strategy led to retaliatory measures from China, resulting in a significant tariff standoff.

Recently, the president has expressed a preference for negotiation over confrontation. There are indications that the US may delay a planned increase in tariffs on Chinese goods. This softer approach has reportedly led to disagreements among the president's advisors.

Furthermore, the US has allowed a chipmaker to resume sales of certain chips to China, despite previous commitments to restrict access to advanced technology. This decision has sparked debate among officials, with some expressing concerns that it could strengthen Chinese tech companies. Others, however, view limited chip exports as a strategic move in the competition for dominance in artificial intelligence.