Thought July 01, 2019 / 02:44 am UTC

Asia Reflections: First Impressions from G20 and Trump-Kim Meeting

By Jeff Ng

U.S. President Donald Trump’s “Art of the Deal” was at the forefront of negotiations. Trump negotiated a truce on trade with China President Xi Jinping, while also meeting North Korea’s Kim Jong Un. We remain skeptical of future progress, as tough negotiations between the U.S. and other countries are ongoing.

There was a flurry of bilateral meetings during the G20 over the weekend. Trump was in the limelight, especially given his meetings with Xi and Kim. This came within our expectations heading into the weekend. We believe that these had been part of Trump’s rhetoric for bilateral negotiations.

The most significant outcome was the U.S.-China trade truce, as Trump and Xi agreed to delay tariffs and negotiate further. This has been helped by Trump’s backtrack on a Huawei ban in the U.S. 

We note that this has been a complete U-turn from his messages earlier the week. 

In addition, Trump met with Kim on June 30 at the Korea Demilitarized Zone. We think that this will likely help with restarting future working-level discussions between the U.S. and North Korea on denuclearization. 

Besides, Trump also came out of meetings with Indian Prime Minister Narendra Modi on a somewhat positive note. This is despite both countries having taken protectionist stances recently, alongside other geopolitical issues.

Overall, the most significant development in our view has been the delay of any further tariffs. 

Despite all the positive vibes over the weekend, we remain skeptical of actual progress in future working-level negotiations. Trump’s conciliatory tone and constant changes in his tone may be part of his negotiation strategy and his rhetoric for the 2020 Presidential Elections. 

Given that the “noise” is likely to persist in the months ahead, we will prefer to focus on the actions undertaken ahead. 


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Analyst Certification
I, Jeff Ng, the lead analyst certify that the views expressed herein are mine and are clear, fair and not misleading at the time of publication. They have not been influenced by any relationship, either a personal relationship of mine or a relationship of the firm, to any entity described or referred to herein nor to any client of Continuum Economics nor has any inducement been received in relation to those views. I further certify that in the preparation and publication of this report I have at all times followed all relevant Continuum Economics compliance protocols including those reasonably seeking to prevent the receipt or misuse of material non-public information.