China and US exchange sanctions ahead of the Xi-Trump summit - CNN
Kyiv • UNN
Beijing has imposed countermeasures against American firms in response to US sanctions. The leaders’ September summit could be a chance to resolve friction over artificial intelligence.
The path to Chinese leader Xi Jinping’s expected visit to the United States next month appears more complicated than Beijing had hoped, CNN reports, writes UNN.
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Several weeks ahead of the state visit, the world’s two largest economies have resumed an "eye-for-an-eye" exchange of sanctions, with Beijing introducing numerous measures against American firms or interests that it says are retaliatory actions in response to America’s "wrongful" conduct.
The United States has banned imports of new humanoid robots (mostly manufactured in China); imposed sanctions on Chinese shipping operators allegedly handling Iranian fuel; placed more than 40 Chinese firms on an entities list over alleged human rights violations; and added two leading civilian universities to the Pentagon’s blacklist. It is also threatening to impose sanctions on Chinese firms involved in artificial intelligence.
This left Beijing "with no choice but to take necessary countermeasures," China’s Ministry of Commerce said Wednesday, announcing a package that imposed sanctions on seven American firms; tightened controls on the export of drones and drone technologies to the United States; and launched an investigation into certain office equipment containing foreign software.
A separate measure also suspends the expedited certification process for products such as electrical appliances for the Chinese market at American plants. The ministry said this was specifically a response to the recent addition of Chinese firms to the U.S. sanctions list, as well as to robotics and earlier technology-related bans issued by the U.S. Federal Communications Commission.
These reciprocal actions, the outlet writes, recall last year, when the rivals were locked in a fierce trade war. It also raises questions about whether a new period of escalation—if it intensifies—could prompt Beijing to freeze Xi Jinping’s upcoming trip, the outlet notes.
For now, a series of China’s measures, which its spokesperson called "restrained," suggests that its leaders hope to keep matters on track for the September summit. Especially since the meeting is viewed as an opportunity for Xi and Trump to discuss what is becoming their fiercest area of rivalry: artificial intelligence.
"China values the hard-won stability of China-U.S. economic and trade relations and hopes that the United States will cooperate with China in the same direction," a spokesperson for China’s Ministry of Commerce said Wednesday, while threatening "further countermeasures" if it does not.
Observers and people close to political circles in China say that Beijing places great value on maintaining high-level lines of communication with Trump, who is considered relatively friendly toward China compared with many of the bigger "hawks" in his administration.
"China has incentives to preserve diplomatic space and avoid an uncontrolled cycle of action and reaction ahead of the (expected) summit," said Sun Chenghao, a senior research fellow at Tsinghua University’s Center for International Security and Strategy in Beijing.
But "restraint should therefore not be confused with acceptance," he added.
What happens next may depend on what steps the United States takes regarding China-developed artificial intelligence, which is a sensitive issue for Beijing.
Trump administration officials, as well as major artificial intelligence companies, have accused Chinese companies of "reworking" advanced American models, and Washington has threatened to impose sanctions over intellectual property theft. Beijing has denied these accusations and urged the United States to "abandon its hegemonic mindset."
Any such sanctions could be interpreted as an attempt to actively disrupt the global growth of China’s large sector—and give Beijing a bitter taste of the first Trump administration’s global campaign against Chinese technology giant Huawei, the outlet notes.
"If the US is going to ban Chinese models on national security grounds, this will affect not only American companies (that use these technologies)," said George Chen, head of the digital practice at Hong Kong-based consulting firm The Asia Group.
"You are essentially talking about the US trying to ban Chinese artificial intelligence models for business practices worldwide, and you are talking about a trillion-dollar market… China is not going to take this lightly," he added.
Beijing has an arsenal of economic tools that it uses to exert economic pressure, including launching investigations and blacklisting companies or individuals, which it used in its measures on Wednesday. But as far as sanctions are concerned, Beijing has not yet directly targeted the American technology giant.
China's main trump card remains its control over global supplies of rare earth elements. These strategically important commodities continue to be a source of friction with the US, despite agreements reached on trading them last year. US Treasury Secretary Scott Bessent told Fox Business last week that rare earth elements "are not circulating as freely as they could."
Washington is also seeking to reduce its dependence on China for critical strategic commodities used in high technology. On Thursday, the White House imposed a 15% tariff, as well as a price ceiling, on polysilicon products, a material used in semiconductors and solar panels that is predominantly produced by China, in order to stimulate domestic industry.
The September summit is seen as a chance for the leaders to resolve tensions over artificial intelligence, and both sides are believed to be preparing for a dialogue on the rapidly developing technology that will take place ahead of the meeting.
It is also a chance to extend the trade truce they reached last October and cement what both sides have called an era of "constructive strategic stability" following Trump's visit to Beijing in May.
One of the discrepancies causing the current friction may lie in how the two sides perceive this term, the publication writes.
For Washington, it appears to be understood as an acknowledgment that both sides will continue communicating and keep tensions manageable. For Beijing, it is interpreted more as an agreement not to "overextend" the use of national security-related restrictions, such as tightening technology export controls or imposing import bans, observers say.
However, as noted, neither side has any illusions about the nature of the prolonged competition.
"Both China and the US are realists; they want to make the other country as little of a threat to themselves as possible – and both sides will prepare for the worst-case scenario," said Shen Dingli, a Shanghai-based international relations researcher.
And both sides know that communication and striving for this constructive strategic stability can make the competition less damaging and "slow the acceleration of a downward spiral" in their relations, he said.
With more than a month remaining before Trump's meeting with Xi, any change in the tone of US-China relations could affect not only whether the visit takes place, but also its scope, the publication notes.
Even if Washington crosses a presumed "red line" for Beijing before the trip, a postponement may not be automatic, said Sun Chenghao of Tsinghua University.
This is because both sides now appear to view leader-level diplomacy "as a mechanism for containing crises, rather than as a reward for good relations," he said.
"Therefore, the more likely consequence is not cancellation, but a narrower summit agenda… and (a focus on) preventing accumulated disputes from triggering a new downward spiral," he said.