At around 3 a.m. today, Xinhua News Agency released a brief dispatch of just over 130 characters. The shorter the text, the bigger the story. Its core message: the two heads of state agreed to further enrich the connotations of the positioning of China-US relations and jointly build a "constructive strategic stability relationship based on respect, fairness, and reciprocity." This is one of the most important outcomes of this summit. It aligns with my earlier judgment that this year marks a turning point in China-US relations. After eight years of trade war, the two sides have finally reached a new equilibrium and entered a new phase.
From 1949 to the present, China-US relations have gone through several important periods: Before 1971, the two sides were fully isolated and hostile, with several local conflicts breaking out in between. Interestingly, just like the trade war of the past eight years, China established (or re-confirmed) its status as a major power through conflict with the United States, such as the Korean War. From 1972 to 1978, there was first a thaw, and then both sides treated each other as partners to counterbalance the Soviet Union (functional and limited). From 1979 to 2009, the US pursued an "engagement policy," hoping to guide China toward a transformation the US expected through trade and exchanges, while China focused on economic development and opening up. During this period, the relationship was generally peaceful, with competition latent. Around 2009, China's GDP exceeded one-third of that of the US (in dollar terms), and the US began to be vigilant, proposing a "pivot to Asia," and competitive elements in the relationship became visible. Around 2018, China's GDP reached two-thirds of that of the US. The US felt a crisis and flipped the table; the trade war broke out, and competition became the dominant tone of the relationship. Then came eight years of trade war and decoupling in key technologies. China demonstrated tremendous resilience, not only setting new records in exports and trade surpluses but also catching up in technology. Trump and Bessent both publicly acknowledged that in the field of artificial intelligence, only China and the US matter, while Europe and other regions "have nothing." The US also realized that full decoupling was disadvantageous to itself (leading to high inflation, rising living costs for ordinary people, forced interest rate hikes, increased national debt burden, unsold agricultural products, etc.), which led to this year's turning point, with discussions beginning on mutual tariff reductions and the addition of the qualifier "based on respect, fairness, and reciprocity" before "constructive strategic stability relationship." Moreover, the US received the Chinese head of state with an extremely rare, ultra-high-level protocol. Since the 1970s, a US president had only personally greeted the Pope during an official state visit, but this time the president personally greeted the Chinese leader at the airport. The 21-gun salute was fired not only upon arrival but also upon departure, which is also extremely rare.
The issue of artificial intelligence was discussed during this summit. What impacts will this produce? Based on current information, the following judgments can be made: 1. The two sides formally established an "artificial intelligence dialogue mechanism," preventing the AI field from completely heading toward bloc-based decoupling, which is conducive to managing the risks brought by technological progress. This alleviates the industry's "most extreme" (pessimistic) predictions and helps stabilize financial markets. 2. The two sides will discuss setting up "fences" and introduce some targeted regulatory measures, but it is highly likely that they will not slow down AI development. 3. The leadership in global AI governance is shifting from the G7 to the G2 (China and the US), and AI rules are unlikely to become a purely Western version. 4. The issue of controls on advanced chips and computing power toward China will be difficult to truly resolve.
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