00:00Well, Jeff Moon is a former assistant U.S. trade representative for China, and he joins me now.
00:06Thank you very much for coming on the program.
00:08Now, the two sides expected to discuss, as Catherine was saying just then, extending that rare-earth minerals truce.
00:16How much leverage do you think China still holds over the U.S. when it comes to rare-earths and
00:21critical minerals?
00:23The U.S. and China arrived at a truce last fall after realizing that neither side can gain a conclusive
00:29advantage over the other, but both can inflict considerable pain.
00:34China gained leverage by exploiting its rare-earth monopoly, and that leverage remains intact.
00:38So the question is how China wants to use that leverage, and I think most people agree that the best
00:45way is to preserve the current truce for the benefit of China, for the U.S., and the global economy.
00:52We're hearing, aren't we, that Boeing aircraft, U.S. agriculture, and energy purchases could be part of the talks.
00:59Are these likely to be meaningful deals, do you think, or is this more about political deliverables?
01:06These purchases are important in the broad sense because they help reduce the enormous trade surplus that China runs with
01:12the United States,
01:13which has become a political issue that complicates bilateral relations.
01:16American companies and consumers will welcome these purchases, but transactions of this nature have been a part of U.S.-China
01:24summits for decades,
01:25and are thus not necessarily unique to this summit.
01:28The question that lingers in the background for Americans is whether China will actually make good on those purchase pledges,
01:35because recent history teaches us that such promises sometimes don't yield results.
01:39Jeff, I just want to talk to you about tariffs for a moment.
01:43So, have tariffs, do you think, strengthened America's negotiating position, or have they hurt U.S. businesses?
01:53Tariffs produce mixed results.
01:54President Trump's tariff policies have resulted in significant concessions from some trading partners
02:00in the form of reduced tariffs and investment pledges,
02:03but tariffs increase costs and throw artificial complications into commercial relationships.
02:09My overall view is that I prefer free trade and don't favor either tariffs or non-tariff barriers,
02:15but U.S.-China trade relations have always suffered from tariffs and non-tariff barriers,
02:20and that situation is likely to continue into the indefinite future.
02:25Now, Trump's got quite an entourage coming with him, we're hearing.
02:28Executives from companies such as Boeing, Citigroup, Qualcomm, they're all expected to travel with him.
02:34What does corporate America want most from this visit?
02:39Corporate executives want geopolitical stability and a level playing field in China.
02:45They know how to design and produce superior products and how to compete in foreign markets,
02:49but they can't control geopolitical tensions between countries and in world markets,
02:55and they can't control the many non-tariff barriers to doing business that they encounter in China.
03:00Governments can help address those problems,
03:02so that's why it's important for corporate executives to participate in some of the events
03:07to make sure that their views are heard and factored into policy outcomes.
03:11And, of course, Iran expected to be a major topic of conversation,
03:15given China's economic ties with Tehran and its role as a major buyer of Iranian oil.
03:22Could trade concessions, do you think, be linked to China's cooperation on Iran?
03:28I really doubt it.
03:29China has influence with Iran because it is providing Iran with oil revenues and weapons-related materials.
03:36The best thing China can do to promote peace in the Middle East is to stop buying Iranian oil
03:40and to cease assisting its military, but I think that's unlikely to happen.
03:45Whatever influence China has, however, is not sufficient to compel Iran to ignore its deeply held religious beliefs
03:52or its unique historical grievances with the United States.
03:57So I think that we can expect that President Trump will probably ask the Chinese for some kind of assistance
04:03to weigh in in favor of peace,
04:04but I doubt that he's going to expend any political capital to get that kind of limited assistance.
04:10Jeff Moon, thank you very much indeed for that.
04:13Thank you very much.
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