- Trump initiated a phone call amid tense trade relations.
- The conversation takes place as accusations arise over essential minerals.
- The fragile 90-day tariff rollback agreement faces challenges with ongoing accusations.
On Thursday, Chinese President Xi Jinping engaged in a phone conversation with US President Donald Trump, according to China’s state news agency, Xinhua. This discussion comes as trade tensions between the two nations continue to mount.
The call was made at Trump’s request, but Xinhua did not disclose any specifics about their discussion.
The White House has yet to provide a comment on the matter.
This highly awaited conversation occurs against a backdrop of blame traded between Washington and Beijing regarding essential minerals in a conflict that threatens to unravel a delicate ceasefire in their ongoing trade war.
On May 12, the two nations agreed to a 90-day deal that would reduce some of the retaliatory tariffs imposed against one another since Trump took office in January.
While the stock market reacted positively, the provisional agreement failed to address broader issues that have strained their relationship, including the illegal fentanyl trade, the status of Taiwan, and US grievances about China’s state-controlled, export-oriented economic model.
Since his return to the White House in January, Trump has consistently threatened various punitive measures against trading partners but has often walked back those threats at the last moment. This erratic behavior has left global leaders and business executives bewildered, with many stating that the unpredictability complicates market forecasting.
In April, China halted exports of several critical minerals and magnets, causing disruptions for automakers, chip manufacturers, and military contractors across the globe.
Beijing views mineral exports as leverage; curtailing them could generate domestic political pressure on the Republican president if economic growth slows due to production delays for mineral-dependent products.
The 90-day tariff rollback agreement remains precarious. Trump has accused China of violating the terms and has imposed restrictions on chip design software and other shipments destined for China, while Beijing has refuted these claims and threatened to retaliate.
Trump has long sought a call or a meeting with Xi, but China has resisted, adhering to its traditional practice of resolving details before involving the leaders.
The US president and his advisors believe that direct conversations between leaders are essential to overcoming the deadlock that has hindered lower-level negotiators.
The last known contact between the two leaders remains unclear.
Investors are closely monitoring the situation, concerned that a chaotic trade war could impact corporate profits and disturb supply chains in the crucial months leading up to the holiday shopping season. Trump’s tariffs are also currently under dispute in US courts.
