At the recent Asia Pacific Economic Cooperation leaders’ meeting in San Francisco, Chinese President Xi Jinping and U.S. President Joe Biden met for the first time in a year. They agreed to resume high level military communication between the two countries, following a halt in relations that was prompted by a surveillance balloon incident and Nancy Pelosi’s visit to Taiwan. This meeting has been seen as a step towards normalizing the strained bilateral relationship between the two countries, which was derailed by these incidents earlier in the year.
Xi and the Chinese Communist Party are grappling with slowing growth in the world’s second-largest economy that has been roiled by a crisis in its real estate sector. The leaders of both countries are now committed to keeping tensions between the U.S. and China in check, in light of domestic challenges. This is aimed at preventing the further exacerbation of bilateral problems and to maintain a pragmatic approach as they deal with their respective domestic issues. The intention is to avoid distractions and complications that could arise from an escalating spiral of trade and technology tensions between the two countries. This move is especially beneficial for President Xi Jinping, who is focused on salvaging the Chinese economy and not creating further problems through continued tensions with the U.S.
At the same time, President Biden is facing underwhelming approval ratings and is trailing Donald Trump in polls for a potential rematch at the U.S. presidential elections in November 2024. With Biden’s age and his handling of the economy being cited as two of his greatest weaknesses, there is added pressure to manage relations with China carefully. This is particularly significant as Xi Jinping has emphasized the need for the U.S. and China to choose between being adversaries or partners, contrasting with Biden’s approach of pursuing strategic competition by restricting exports of advanced U.S. tech to China while seeking areas of cooperation. Balancing this approach with the need to address domestic challenges is a critical issue that both leaders face moving forward.
