The Financial Express

Xi Jinping reenacts 'ping-pong diplomacy' at G-20 Summit!

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Photos: Reuters and AP Photos: Reuters and AP

One needs to re-visit the G-20 Summit, an annual meeting of leaders from the countries with the largest and fastest-growing economies that was convened in Osaka, Japan in June. This is required to understand the evolving geo-strategic paradigm.

The Summit witnessed several dimensions pertaining to climate change, Iran, protectionism and global trade, as well as a host of bilateral meetings between leaders. The media highlighted through photographs symbolic differences of opinion and also efforts to bring about a convergence of views within the evolving parameter.

There were significant discussions on issues which are casting long shadows in the arena of security, trade and commerce and the environment. The dimensions of the topics assumed importance because of the nature of the participating countries. They represented different facets in international relations, each with their own priority in terms of national interest.

The very first day saw President Trump through a light-hearted conversation making light of possible future Russian election interference during his meeting with President Putin on the sidelines. The meeting between the two leaders was their first since a summit in Helsinki last July. It was also their first meeting since Robert Mueller concluded his investigation into alleged Russian interference in the 2016 US presidential election. US intelligence agencies had purportedly concluded that Russia was behind an effort to influence the presidential election with a state-authorised campaign of cyber-attacks and fake news stories planted on social media. However, special counsel Mueller's report allegedly found no evidence that the Trump campaign criminally conspired with Russia to influence the election.

PUTIN TALKS TO FT: President Putin apparently did not react to Trump's light-hearted reprimand but took the opportunity of his being in Osaka to give an interesting interview to London's Financial Times wherein he underlined his thoughts on both global and domestic politics. He indicated, to the surprise of the participating nations that liberalism was "obsolete", and praised the rise of populism both in Europe and the US. He described Mr Trump as a "talented person" who knew how to relate to voters.

The next event that drew the attention of the international audience was the frosty photo opportunity that took place during the meeting between the unsmiling departing British Prime Minister May and President Putin. The media was witness to May's hard comments regarding the poisoning of former spy Sergei Skripal last year. This also reflected potential future difficulties in bilateral relations between these two countries. The Kremlin, it may be recalled, has however denied any involvement in the attack.

TRUMP, XI AND TRADE WAR: There was another aspect that was followed most closely by the international community. It related to the efforts that were undertaken by Mr Trump and China's President Xi Jinping to resolve their bitter trade dispute. It may be recalled that talks ground to a halt last month when Mr Trump accused China of reneging on its earlier promises and took the decision to raise tariffs on US $200 billion worth of Chinese goods. This move had come as a surprise to many who had thought that the US and China were nearing a trade deal. China subsequently retaliated with its own tariff hikes. The two leaders had last met at another G20 summit in Buenos Aires last year and had agreed on a 90-day truce to their trade war.

G-20 leaders carefully followed the evolving equation on trade matters between the US and China as it was creating a huge challenge for businesses all over the world and the global economy. Analysts covering the G-20 Summit this time noted that the trade clash had assumed critical dimensions over recent decisions undertaken by the USA and also China. The US had tightened restrictions on Chinese telecom mega-company Huawei and four other Chinese tech firms by putting them on a trade "blacklist". Beijing had also responded angrily to this decision with threats of its own trade ban - that also included increased scrutiny on American firms operating in China, including FedEx. It was clear before the Osaka meeting that the scenario was becoming critical because Trump had threatened to impose tariffs on US$ 300 billion of Chinese goods. This meant that almost everything that China sells to the US would be subject to tariffs.

US companies had urged Trump to end the trade war warning of higher prices and risks to their future. This encouraged everyone to hope that a compromise of sorts and a trade truce would be reached through bilateral discussions between Trump and Xi in Osaka. This belief was based on the fact that China's economy was slowing down and Trump was also heading towards an election year. These factors, it was believed, would influence both countries.

The world held its breath and was eventually happy to know that both countries after discussion between the two leaders in Osaka had agreed to revive trade and tariff discussions along with all its connotations.

After the talks between Trump and Xi, the US President remarked that "We're right back on track. We'll see what happens." Participants included US Trade Representative Robert Lighthizer, US Treasury Secretary Steven Mnuchin and Chinese Vice Premier Liu He. Chinese state media Xinhua reported that trade talks between the US and China would resume and the countries will "carry out discussions on specific issues." Xinhua noted that the US side had agreed to "no longer impose new tariffs on Chinese exports".

About his meeting with President Trump, there was  a symbolic reference from President Xi. He recalled the 1970s-era ping-pong diplomacy between the two countries, using the reference to illustrate how a "small ball played a big role" in establishing diplomatic ties between Beijing and Washington. He added in that context "One basic fact remains unchanged. China and the United States both benefit from cooperation and lose in a confrontation." Many are saying that the small ball in question might have acquired greater significance through President Xi's visit to North Korea just before the G-20 Summit. This underlined China's potential role in helping the United States solving this problem. This factor was later translated into President Trump's meeting with the North Korean leader, his crossing the DMZ (demilitarised zone) line and having a brief discussion with the DPRK (Democratic People's Republic of Korea ) leadership.

Trump had earlier threatened additional trade sanctions on China, but after this meeting in Osaka has confirmed that the US would not be adding tariffs on US$300 billion worth of Chinese imports. He has also said that the US would continue to negotiate with Beijing "for the time being". At a subsequent press conference, the US President also declared that US technology companies could again sell to China's Huawei - effectively reversing a ban imposed last month by the US commerce department. This ban had prevented US tech firms from selling to Huawei, crippling the Chinese firm's ability to get critical American technology to help it make its products. It is still not completely clear whether what Trump has announced is a complete reversal. However, if it is, it would be a significant concession by the US on a company that Washington has said is a threat to national security.

Nevertheless, the resumption of talks and "pressing the pause button on more tariffs" will be seen in the short-term as positive for markets and American businesses. It may be mentioned here that many sectors within the US business community had in recent weeks pointed out that the cost of further tariffs for American consumers would have ended up in payment of nearly US$ 12 billion more in the form of higher prices.

This has been welcomed by Chinese businesses also. They have been suffering because of the trade war. It has had an impact on investment plans, business confidence and exports in the world's second largest economy.

However, BBC has remarked that "pressing pause does not mean the trade war is over. Tariffs on hundreds of billions of dollars worth of goods are still in place. And the two sides still have much to agree on". One must not forget that Washington still wants Beijing to fundamentally change the way China's economy functions by getting rid of subsidies to state-owned companies and opening up its domestic market.

Viewed from this angle, the truce signals a pause in hostilities between the world's largest economies, rather than a resolution of the year-long dispute which has caused market turbulence and affected global growth.

CLIMATE ISSUE: British Prime Minister May and French President Emmanuel Macron also played an important role in drawing the attention of the G-20 participants in joining together in a meaningful manner in overcoming the challenges resulting from climate variability and also in the tackling of plastic waste which was creating fears with regard to marine life. Theresa May called on the G20 countries to set targets for net zero greenhouse gas.

However, only 19 of the 20 leaders signed up to the statement, which committed them to the "irreversibility" of the 2015 Paris agreement and pledged the full implementation of its targets to reduce greenhouse gas emissions. US President Donald Trump declined to sign.

Environmental issues came to the forefront due to a report prepared by the United Nations. The UN pointed out that nearly 300 million tonnes of plastic waste is produced every year, and around 8.0 million tonnes end up in the oceans, killing marine life and choking up the oceans with toxic chemicals. In this context, Japan urged nations to firmly commit that they would ban single-use plastic and help to reduce plastic waste to zero in the oceans. As expected, there was some resistance in this regard from the US, over concerns of what this could do to its petrochemicals and plastics industries.

There was also another important aspect that received due attention during this G-20 Summit. The British Prime Minister drew attention of all countries towards the need to fight together against the spread of malaria and tuberculosis.

This time round, the G-20 Summit appears to have correctly addressed the view that unity and a constructive interactive engagement by working together is better than divisive policies.

Muhammad Zamir, a former Ambassador, is an analyst specialised in foreign affairs, right to information and good governance.

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