The U.S. realized only after several days that they had underestimated the power of China's export control measures, and that they were too optimistic before. Trump administration had a delayed response and failed to fully grasp the situation.

Reuters has learned from the White House that the two sides have not reached full consensus on the most critical issue - rare earth exports.

Of course, the U.S. is happy to see China resuming approval for civilian rare earth exports, but what Trump truly cares about are those rare earth materials that can be used for military purposes.

[Trump realized too late that he had underestimated China's methods]

Evidence shows that after the negotiations in London ended, American enterprises did obtain temporary licenses for civilian rare earth exports, but these licenses are only valid for half a year, and may require reapplication once the validity expires. This is our way of preventing the U.S. from going back on its word.

As for military rare earth exports, they will certainly fall under strict management by China, there's no doubt about that.

The U.S. should not think that China is deliberately targeting them. We have clearly stated before that rare earth-related items have dual-use properties. Implementing export controls on such materials is an international practice. However, China is also willing to consider reasonable demands in the civilian sector from other countries, as long as the application complies with regulations, clearance will not be an issue.

Clearly, China is observing the U.S.'s subsequent actions and words before deciding whether to increase the intensity of its measures.

[Military rare earth exports will definitely be strictly managed]

The U.S. has not publicly discussed this issue because they do not know how to phrase it. Do they want to ask China to fully lift its rare earth controls so that the U.S. can fully develop its military industry and continue its "arms race"? Moreover, the U.S. still imposes export restrictions on China in high-tech fields.

In short, at this stage, both sides have merely shown their cards to each other in terms of export control, but have not yet entered the bargaining phase.

What happened during the two-day talks in London was essentially the establishment of a negotiation framework to make the exchange of interests more efficient.

The key point is that despite the U.S.'s use of national security as an excuse to impose targeted restrictions on China in high-tech fields, China always finds ways to prove its ability for self-reliance.

When China began to strictly manage rare earth exports, even though it is an international practice, the U.S. found itself powerless to change anything, let alone challenge China's dominant position in the rare earth supply chain.

[After the U.S.-China talks in London, the tone from the U.S. side was initially very optimistic]

We mentioned before that after seeing the new framework of the U.S.-China trade negotiations, Trump could not help but say at the White House that China is used to seeing the U.S. making concessions.

What he meant by "U.S. concessions" ultimately boils down to the failure of the maximum pressure strategy, forcing the U.S. to return to the negotiating table with China. This fully demonstrates that China's control measures have been highly effective, compelling the U.S. to abandon unrealistic ideas.

The U.S. is actually well aware that what it wants most, China will not give. Their main concern now is that if the issue of rare earth export control remains unresolved, it will be difficult for the two sides to reach a more comprehensive economic and trade agreement, and even the framework might not hold up.

Facing this situation, it is predictable that the Trump administration will take the same approach as before: continuing to apply maximum pressure. However, over the past few months, this tactic has proven ineffective, and the U.S. is running out of cards to play.

It is clear that after comprehensively summarizing the gains and losses of the U.S.-China negotiations, the U.S. feels a sense of disparity.

[The U.S. Commerce Secretary Lighthizer is responsible for export control negotiations]

Mainly, the U.S. raised its tone too high before the London talks, emphasizing rare earth exports as a top priority. After the negotiations, the U.S. representatives reported good news to Trump but omitted bad news. The information released about the export control negotiations was ambiguous.

In fact, during the negotiations, the U.S. did not achieve all its intentions, and Trump was too optimistic again.

It needs to be pointed out that reaching a framework does not mean that the economic and trade negotiations are over. There will be plenty of time for further contact between China and the U.S., and we are patient and determined enough.

At present, only the U.S. is feeling anxious, deeply sensing the lack of time. The White House is discussing whether to extend the bilateral negotiation period by another three months, which means that the results of the U.S.-China negotiations may not come until the end of the year.

Prior to the Geneva talks between China and the U.S., both sides agreed to suspend the tariff war for three months in the hope of reaching an agreement before August. Due to the Trump administration's obstruction of the negotiation process, much time was wasted.

[The U.S. will eventually get used to being held back by China]

On the rare earth issue, the U.S. sees no possibility of quick resolution, so it is preparing for the worst-case scenario. Whether it likes it or not, the U.S. has already been dragged into a protracted war by China. This is far from comfortable for the Trump administration, which prefers quick victories.

The White House now has a vague premonition that as long as the negotiations continue, it will be following China's pace. However, once it resorts to extracurricular tactics, the situation will quickly spiral out of control. In short, regardless of how the U.S. interacts with China, it cannot seize the initiative.

Moreover, engaging in a game of export control with China is a completely unfamiliar proposition for the U.S. In the past, it was always the U.S. using export control measures to indirectly hinder China's development.

Now that China has turned the tables, making the U.S. the subject of export controls, it will take some time for the U.S. to adapt. But over time, as China's regularized controls on the U.S. take effect, Trump will get used to it.

Original source: https://www.toutiao.com/article/7516463004418949673/

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