Taiwan amidst Trump and Xi Jinping
Xulio Ríos, emeritus advisor to the China Policy Observatory.
On 20 January 2025, Donald Trump was sworn in as President of the United States. A few days earlier he had a surprise telephone conversation with Chinese President Xi Jinping. Trump said it was ‘very good’, and Xi did not mince his words. Xi, though invited, did not attend the Washington ceremony in person but, for the first time in history, a senior Chinese dignitary, Vice President Han Zheng, attended the event as his special envoy. Trump reinforced the nod towards China with a conciliatory gesture towards TikTok, although it does not remove the question mark over the future of the Chinese platform.
US-China rapprochement?
Both leaders seem to want to convey a certain interest in fostering a new atmosphere in bilateral relations. Will this be possible? Trump has been instrumental in creating a very anti-Chinese political scenario, not only in terms of his announcements on tariffs or technological tensions, but also because of the presence in his entourage of many figures who are highly critical of China and who, in their appearances in the Senate, have multiplied their accusations of Beijing. Already in his first term in office, he spared no expense in accusing China, marking the end of the period of cooperation between the two powers, until then the predominant one, despite the discrepancies. Today, the wave of mistrust towards China persists, and to a large extent, the realisation of Trumpism’s main slogan requires widening the power gap with Beijing.
The possibility of reaching a substantive agreement on relevant issues seems difficult, but this does not mean that both sides should throw in the towel. On the contrary, they should try to avoid a catastrophic spiral in their relationship. The phone call indicates that US-China relations are at the top of Trump’s agenda. It is certainly a priority shared by Xi. And the frequency of phone calls and meetings between Trump and Xi is likely to increase in the coming weeks to explore the possibility of progress. Joe Biden leaves him with a legacy of restoring much of the channels of communication with China, with some measure of stability despite how much the rift has intensified.
Be that as it may, Trump’s call with Xi, even earlier than the expected call with Putin in light of his pledges to immediately end the war in Ukraine, implies that he considers the US-China rivalry an important issue that needs to be addressed urgently.
Taiwan at the height of the discord
There are two versions of the 17 January phone conversation. Trump wrote on his social networking site Truth Social that the two discussed ‘balancing trade, fentanyl, TikTok and many other issues’, but did not specifically mention Taiwan. On the contrary, the Chinese version claims that Xi reaffirmed sovereignty over the island and made a particular appeal for prudence and caution to the White House on this issue, which he considers the big ‘red line’.
Taipei has fond memories of Trump’s first term in office. Then, another phone call, the one he made public with then Taiwanese president Tsai Ing-wen, set off alarm bells in Beijing. It was followed by many gestures of undoubted political scope that de facto strengthened Taiwanese sovereignty. It may now be that the choice of Xi over Lai Ching-te for that call signifies some willingness to show restraint on this issue. Or even more, perhaps a solid agreement.
Trump used Taiwan to poke China in the eye, probably with the aim of getting some quid pro quo in other orders, especially trade. In truth, it did not work. It remains to be seen whether he has realised the real meaning of China’s assertion that Taiwan is part of its ‘core interests’ and does not admit negotiation over it.
Taipei, now under the continuist leadership of Lai Ching-te, is on guard against Trump over accusations regarding the trade deficit, the future of the chip industry and ‘insufficient’ defence spending. It relies on the good connections of its vice-president Hsiao Bi-Khim with the Washington galaxy. The strategy has been decided. Taiwan is convinced that Washington cannot leave the island to its own devices at the risk of losing its strategic legitimacy in the Indo-Pacific and beyond. Lai Ching-te’s approach aims to facilitate an alignment of interests, including increased industrial and technological investment in the US, without ruling out the partial relocation of the semiconductor industry, a line of work that has already been underway.
Defence is the trickiest chapter. Taiwan can remind Trump that Taipei ‘pays more’ than the US’s NATO allies for its own defence given that the island’s military budget exceeds NATO’s target of 2 per cent of gross domestic product (GDP) for its member states. But it will have to do more, starting by requesting billions of dollars in arms purchases from the United States. This is already underway, and a major order may materialise in the coming months with the unmistakable aim of appeasing Trump and reassuring him that his concerns have been listened to carefully.
Internally in Taiwan, the difficulty lies in the fact that the government does not have the necessary majority in the Legislative Yuan. At present, the differences with the opposition are abysmal and are reflected, among other things, in significant budget cuts that will also affect the defence sector in a singular way. On the very day of Trump’s inauguration, the Taiwanese parliament passed a motion to freeze half of the proposed funding for 2025 to continue the process of building a fleet of indigenous defence submarines. It is clear that, without its consent, the sovereignty strategy may flounder.
Enabling a consensus in Taiwan – similar to the one that exists in the US between Democrats and Republicans over China – to support the pro-sovereignty strategy is materially impossible. At present, the opposition’s tactic is to impose an active blockade on government action. This could make it very difficult to implement any measures in line with the Trump administration’s demands.
Thus, while it is vital for Taiwan to align itself with Trump’s interest in order not to lose favour with the US administration, Trump’s interest in Taiwan clashes not only with Xi’s interest, but also with the purpose of the domestic opposition interested in conditioning Lai’s mandate. This Gordian knot will be a complex one to manage.
Perspectives
Focusing on possibilities for agreement and putting aside differences is a common practice in Chinese diplomatic approaches. In the case at hand, this will only be possible as long as the White House exercises caution on the Taiwan issue. Any ‘overreach’ on this issue, such as an inordinately large arms bill or significant progress in the US military presence on the island, will have a major impact on other issues.
Not only because it is a conceptually ‘core interest’ for China, but also because for Xi the redirection of the Taiwan issue is of vital importance to his project of China’s national rejuvenation. Without Taiwan, there is and will be no Chinese dream. And his own political security would be in question.
A negative and qualitative leap in this triangle, which cannot be ruled out given the close connections of a good part of Trump’s team with Taiwan, would scupper any possibility of understanding. And, make no mistake, China would be willing to pay the price.