After much speculation, China and the U.S. are discussing the potential for Presidents Trump and Xi to meet at the upcoming G20 leaders' summit in Argentina toward the end of November. As the nations prepare for possible talks, instability in world financial markets as well as concerns over currency provide key points of potential negotiation.
Earlier in the week, U.S. stocks suffered their largest plunge in months, with the Dow Jones Industrial Average falling 831 points. Technology companies were particularly affected, with American innovation giants Apple and Amazon both experiencing their worst day in over two years. By Friday, U.S. and world stocks alike recovered some of their losses; the Dow Jones jumped 305 points, Hong Kong's Hang Seng gained 2.1 percent and the Shanghai composite saw an increase of just under 1 percent.
In addition to stock market fluctuations, U.S. officials have noted that the value of the Chinese yuan remains a topic of contention between the two countries. Speaking to CNBC ahead of the IMF and World Bank meetings in Bali, U.S. Secretary of the Treasury Steven Mnuchin said, "We are going to make sure that currency is definitely part of these discussions. We are going to make sure that whatever we make up on trade we don't lose on currencies."
Speaking on Friday, Chinese Foreign Ministry spokesman Lu Kang did not confirm the meeting, but noted, "China and the U.S. maintain communication on dialogues and exchanges at all levels." Outside analysts have speculated about the respective negotiating teams, estimating that Liu He, President Xi's economy envoy, will be active in the preparations. On the U.S. side, the Wall Street Journal highlighted the involvement of relatively unknown business consultant Christopher Nixon Cox, the grandson of President Richard Nixon, who is expected to take a leading role. With many details pending, any financial calm stemming from the meeting's announcement illustrates the far-reaching implications of such a dialogue. As China-US Focus contributors Sun Chenghao and Wang Xiaonan explained today, the U.S. and China are in a new period marked by significant change. However, it is possible for both countries to realize that "a ruling power and a rising power are not destined for war."
Prepared by China-US Focus editorial teams in Hong Kong and New York, this weekly newsletter offers you snap shots of latest trends and developments emerging from China every week, while adding a dose of historical perspective.