What The G2 Summit Will Show Us

It is sometimes said, not least by President Donald Trump, that America and China now form a “G2”, a pair of superpowers supposedly leading the world. The Economist argues that this is a disturbing idea. America is led by a president who treats allies transactionally and weakens institutions that supported global stability for decades.China, meanwhile, is ruled by an authoritarian regime that intimidates its neighbours and quietly fuels conflicts it could help calm.

Even worse, both countries increasingly see their deep economic ties as security vulnerabilities. Trade, technology, finance and supply chains have become weapons. That is why the upcoming Trump-Xi summit in Beijing, scheduled for May 14th and 15th, matters so much. It will be the first of four expected meetings before the end of 2026, and the next few months could shape global politics for years, affecting everything from AI and semiconductors to Taiwan and Iran.

Still, expectations for a breakthrough are low. Relations are so tense that meaningful cooperation appears unlikely. With more discipline and humility, Trump and Xi might reduce the risk of catastrophic conflict and identify areas of mutual benefit. Instead, much depends on Trump’s unpredictability. He alternates between describing Xi Jinping as both a friend and an enemy. Xi, by contrast, is more ideologically fixed: he appears convinced that America is declining and that the world should gradually accommodate a rising China.

Trade will dominate the summit. For nearly a decade the two powers have been trapped in a cycle of escalating tariffs and economic retaliation. At the beginning of 2025, a full rupture seemed possible after tariffs exceeded 100% on both sides. Since then, tensions have eased somewhat, but the current situation resembles less a truce than a stalemate based on mutual vulnerability. China can disrupt global manufacturing by restricting rare-earth exports, while America can impose crushing sanctions on advanced technology and global financial flows.

This equilibrium is unstable. America is attempting to weaken China’s grip on rare earths, while China is investing heavily in domestic semiconductor production and trying to reduce dependence on the dollar-based financial system. For now, even a modest outcome—simply maintaining predictable trade relations—would help businesses operate more normally. Trump’s fixation on tariffs makes dramatic cuts unlikely, though keeping them at present levels might at least prevent further disruption. American proposals for a formal “Board of Trade” to manage bilateral commerce would probably become cumbersome and ineffective; regular dialogue would work better.

The risk of miscalculation remains high. American officials are investigating Chinese industrial overcapacity and allegations of forced labour, inquiries that could justify new tariffs within months. China has responded with “blocking measures” threatening punishment against firms that comply with certain American sanctions. Beijing has also warned companies against shifting supply chains away from China, precisely the diversification strategy Washington encourages. Global companies increasingly face a coercive choice over which superpower they fear more.

Although American negotiators want the summit focused mainly on trade rather than security, Chinese officials see opportunity in Trump’s unpredictability. Beijing hopes Trump may soften America’s position on Taiwan in exchange for trade concessions. Chinese officials reportedly believe he could reduce arms sales to Taiwan or more explicitly oppose Taiwanese independence. The Economist warns that such concessions would be dangerous: abandoning a democratic partner and jeopardising the world’s most important semiconductor producer would be reckless. The current balance, though imperfect, has preserved a prosperous Taiwan, a rising China and relative peace across Asia.

Meanwhile, broader global crises receive insufficient attention. The article argues that America’s attack on Iran was strategically misguided, while China has exploited the situation diplomatically without seriously helping to resolve it. Beijing has hosted Iranian officials, yet hesitates to pressure Tehran meaningfully because of its broader aversion to involvement abroad. China’s moral position is further weakened by its support for Russia’s war effort through energy purchases and dual-use exports. The summit should also address Ukraine, but it is unlikely to become a major topic.

There are many other areas where responsible leadership could matter. America and China are both leaders in artificial intelligence and therefore should cooperate on risks such as biosecurity. Climate cooperation, once one of the few areas of collaboration, has deteriorated sharply under Trump. Pandemic prevention has also become politicised because of disputes over the origins of covid-19 and allegations surrounding the Wuhan laboratory.

The article concludes by contrasting today’s atmosphere with the cold war. Despite intense ideological rivalry, America and the Soviet Union still negotiated agreements on nuclear arms, scientific cooperation, borders and medical research. America and China are far more economically intertwined than America and the USSR ever were. Yet both governments now see cooperation itself as a trap through which the other side could impose rules or gain advantage. Dominance, not global public goods, has become the priority.

As a result, the summit will probably produce little beyond symbolic gestures and carefully staged smiles. Officials on both sides insist that continued dialogue matters, but conversation alone is not enough. Without meaningful results, the relationship risks becoming one in which America and China remain at the table not because they trust each other, but because each fears the damage the other can inflict. The Economist’s final warning is stark: the G2 is not truly leading the world—it is holding it hostage.

Source:

https://economist.com/leaders/2026/05/07/the-trump-xi-summit-will-expose-a-dysfunctional-duo

You might also like: