NEWS BRIEF
President Donald Trump and Chinese President Xi Jinping are expected to discuss a TikTok agreement during their first known call in three months on Friday, aiming to keep the popular video app online in the U.S. while easing broader trade tensions between the superpowers. The potential deal would transfer TikTok’s U.S. assets from Chinese owner ByteDance to American owners while still utilizing ByteDance’s algorithm, though key questions remain about ownership structure and whether Congress will approve the arrangement that lawmakers fear could still allow Chinese surveillance and influence operations.
WHAT HAPPENED
- The leaders will discuss a TikTok agreement alongside trade issues in their first conversation in three months. China hasn’t confirmed the call, which comes as both governments discuss a potential APEC summit meeting in South Korea.
- The agreement would transfer TikTok’s U.S. assets from ByteDance to American owners while keeping ByteDance’s algorithm. Trump declined to enforce the January 2025 shutdown mandate, saying the app helped get him elected.
- Trump said countries are “pretty close to a deal” on larger trade negotiations, potentially extending current terms. Key issues include semiconductors, Chinese purchases of U.S. soybeans and Boeing planes, and fentanyl chemical export crackdowns.
- Limited agreements since May paused escalating tariffs that reached triple-digit percentages in April. China had restricted rare-earth exports while Trump blocked Beijing’s semiconductor and jet engine access.
WHY IT MATTERS
- Economic pressure drives compromise: Slowing economies in both countries push leaders toward deals despite strategic competition. Trump’s near-century-high tariffs haven’t broken China’s position as America’s third-largest trading partner.
- TikTok became a diplomatic weapon: China’s use of rare earth restrictions and TikTok negotiations shifted bargaining power in Beijing’s favor. The app’s 170 million American users create significant political pressure on Trump.
- Security concerns remain unresolved: Lawmakers worry any deal using ByteDance’s algorithm enables Chinese surveillance and influence operations. The arrangement highlights difficulties separating technology from geopolitical competition.
- Regional flashpoints neglected: Taiwan and South China Sea tensions struggle for Washington attention amid focus on trade deals. These security issues could undermine economic agreements if ignored.
IMPLICATIONS
- Tech decoupling proves impossible: The TikTok arrangement shows challenges of separating American-Chinese technology ecosystems completely. Future regulations must balance security with digital integration realities.
- Congressional approval uncertain: Republicans may reject deals maintaining ByteDance algorithm involvement over national security concerns. Trump could face significant party opposition to insufficient security protections.
- Trade peace remains fragile: While tariff escalation pauses, structural technology and market access issues stay unresolved. Any agreement may prove temporary without addressing fundamental competitive dynamics.
- Economic coercion normalized: China’s successful rare earth and TikTok leverage could encourage similar authoritarian tactics globally. Democratic nations need new strategies against economic weaponization.
This briefing is based on information from Reuters
