Where Things Stand in the US-China Trade War

FILE PHOTO: A person works at the Amazon warehouse, busy on Prime Day, in Melville, New York, US, July 11, 2023. REUTERS/Soren Larson/File Photo
FILE PHOTO: A person works at the Amazon warehouse, busy on Prime Day, in Melville, New York, US, July 11, 2023. REUTERS/Soren Larson/File Photo
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Where Things Stand in the US-China Trade War

FILE PHOTO: A person works at the Amazon warehouse, busy on Prime Day, in Melville, New York, US, July 11, 2023. REUTERS/Soren Larson/File Photo
FILE PHOTO: A person works at the Amazon warehouse, busy on Prime Day, in Melville, New York, US, July 11, 2023. REUTERS/Soren Larson/File Photo

US and Chinese officials meet this weekend in Geneva for their first formal talks aimed at resolving a grueling tit-for-tat tariff war that threatens hundreds of billions in trade and roiled global markets and supply chains.

AFP looks at how the trade row between the world's two economic superpowers is playing out:

What steps have the two sides taken so far?

The United States has raised tariffs on Chinese imports to 145 percent, with cumulative duties on some goods reaching a staggering 245 percent.

As well as the blanket levies, China has also been hit with sector-specific tariffs on steel, aluminium and car imports.

Sales of Chinese goods to the United States last year totaled more than $500 billion -- 16.4 percent of the country's exports, according to Beijing's customs data.

Beijing has vowed to fight the measures "to the end" and has unveiled reciprocal tariffs of up to 125 percent on imports of American goods, which totaled $143.5 billion last year, according to Washington.

China has filed complaints with the World Trade Organization (WTO), citing "bullying" tactics by the Trump administration.

And it has gone after US companies, scrapping orders for Boeing planes, probing Google for "anti-monopoly" violations and adding fashion group PVH Corp. -- which owns Tommy Hilfiger and Calvin Klein -- and biotech giant Illumina to a list of "unreliable entities".

Beijing has also restricted exports of rare earth elements -- critical for making a wide range of products including semiconductors, medical technology and consumer electronics.

- What's been the impact? -

Beijing has long drawn Trump's ire with a trade surplus with the United States that reached $295.4 billion last year, according to the US Commerce Department's Bureau of Economic Analysis.

Chinese leaders have been reluctant to disrupt that status quo.

But an intensified trade war could mean China cannot peg its hopes for strong economic growth this year on exports, which hit a record high in 2024.

US duties further threaten to harm China's fragile post-Covid economic recovery as it struggles with a debt crisis in the property sector and persistently low consumption.

The tariff war is already having an impact in the United States, with uncertainty triggering a manufacturing slump last month and officials blaming it for an unexpected economic contraction during the first three months of the year.

"Both countries have surely found out that it is not so easy to fully decouple," Teeuwe Mevissen, senior China economist at Rabobank, told AFP.

"Both the US and China lose economically with the current trade war," he said, adding that even in the case that one side gains the upper hand "it is still worse off economically than before the trade war started".

The head of the WTO warned in April that the US-China standoff could cut trade in goods between the two countries by 80 percent.

Beijing announced a raft of interest rate cuts on Wednesday aimed at boosting consumption -- a possible sign that it is starting to feel the pinch.

Analysts expect the levies to take a significant chunk out of China's gross domestic product, which Beijing's leadership have targeted to grow five percent this year.

Likely to be hit hardest are China's top exports to the United States -- this includes everything from electronics and machinery to textiles and clothing.

And because of the crucial role Chinese goods play in supplying US firms, the tariffs may also hurt American manufacturers and consumers, analysts have warned.

Is a breakthrough possible?

Both sides insist that economic pressures have driven the other to seek negotiations.

But while markets have welcomed the talks, a major breakthrough in Geneva seems unlikely.

China has insisted its position that the United States must lift tariffs first remains "unchanged" and vowed to defend its interests.

US Treasury Secretary Scott Bessent has said the meetings will focus on "de-escalation" -- and not a "big trade deal".

But analysts do expect some form of tariff reduction to be announced following Saturday's ice-breaking exercise.

"One possible outcome of the Switzerland talks is an agreement to pause most, if not all, of the tariffs that have been imposed this year while negotiations take place," Bonnie Glaser, managing director of the German Marshall Fund's Indo-Pacific program, told AFP.

Lizzi Lee from the Asia Society said she expected "a tentative, symbolic gesture -- designed to lower temperatures, not resolve core disputes".

"Stabilization and guardrails are the most likely outcomes."



Saudi Arabia Expands Tourist E-Visa Eligibility to Four More Countries

The tourist visa allows visitors to attend events, perform Umrah, and visit exhibitions and conferences (SPA)
The tourist visa allows visitors to attend events, perform Umrah, and visit exhibitions and conferences (SPA)
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Saudi Arabia Expands Tourist E-Visa Eligibility to Four More Countries

The tourist visa allows visitors to attend events, perform Umrah, and visit exhibitions and conferences (SPA)
The tourist visa allows visitors to attend events, perform Umrah, and visit exhibitions and conferences (SPA)

Saudi Arabia has expanded its electronic tourist visa program by adding four countries to the list of eligible nationalities: Mexico, North Macedonia, Serbia, and Bosnia and Herzegovina.

The Ministry of Tourism said the move is part of ongoing efforts to facilitate travel to the Kingdom for visitors from around the world, allowing citizens of the newly added countries to apply electronically for tourist visit visas.

The tourist visa also permits holders to attend events, perform Umrah, visit exhibitions and conferences, and visit relatives and friends, in accordance with applicable regulations and instructions.


50-Year Contracts Open New Horizons for Real Estate Investment in Saudi Arabia

A neighborhood in the Saudi capital, Riyadh (SPA)
A neighborhood in the Saudi capital, Riyadh (SPA)
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50-Year Contracts Open New Horizons for Real Estate Investment in Saudi Arabia

A neighborhood in the Saudi capital, Riyadh (SPA)
A neighborhood in the Saudi capital, Riyadh (SPA)

Long-term real estate investment models are opening new opportunities for Saudi Arabia's private sector, as the Kingdom seeks to expand partnerships with investors to develop municipal assets and transform them into mixed-use projects.

The approach is expected to enhance the appeal of the real estate market, create investment opportunities spanning decades, and attract domestic and international capital to urban development. It also aims to improve land-use efficiency, maximize the economic value of municipal assets and increase housing supply.

Riyadh Region Municipality, the Ministry of Municipalities and Housing, and the National Center for Privatization & PPP (NCP) announced the launch of the expression of interest, prequalification and proposal submission phases for a joint land investment project in northern Riyadh.

The project involves developing a plot of municipal land under a 50-year partnership with the private sector, marking the municipality's first initiative under this joint investment model.

The private-sector partner will be responsible for designing, constructing, operating and maintaining all project facilities.

Located on Zaid bin Asim Street, the strategically positioned 30,015-square-meter site benefits from flexible urban planning regulations that allow for mixed-use development, including residential, commercial, office and recreational facilities.

The project aims to deliver high-quality developments that meet growing demand, serve local residents and community needs, and strengthen Riyadh's urban infrastructure.

Long-Term Investment Strategies

Offering investment opportunities through contracts extending up to 50 years represents a shift in how Saudi Arabia develops government-owned real estate assets.

The model gives private-sector investors a longer timeframe to develop projects and implement long-term investment strategies, overcoming some of the limitations associated with short- and medium-term contracts.

It also strengthens investors' ability to undertake financial and operational planning, allowing them to recover development costs and generate investment returns over a longer period.

This could make such opportunities more attractive to real estate companies and institutional investors.

The project forms part of Riyadh Region Municipality's strategy to improve the efficiency of municipal asset management, expand private-sector participation in urban development and attract high-value investments.

These efforts are intended to promote sustainable urban development, keep pace with the capital's rapid growth and advance Saudi Vision 2030 objectives, in line with the municipality's ambition to help create a prosperous, sustainable Riyadh with a higher quality of life.

Project Sustainability

Real estate expert Khaled al-Mobid said the launch of a 50-year investment project in Riyadh's Al-Narjis district represents an important step toward enabling the private sector to develop real estate assets and transform them into sustainable projects with substantial economic value.

Speaking to Asharq Al-Awsat, he explained that the extended investment period encourages developers to improve construction quality and services while enhancing the financial viability of projects.

He added that the model could help diversify real estate offerings and increase supply in one of the capital's most expensive neighborhoods.

Al-Mobid said the project's significance lies less in its immediate impact on property prices than in its potential to establish a replicable investment model.

Such a model, he noted, could gradually increase supply, strengthen competition and contribute to greater price stability across Riyadh's real estate market.

Diversifying Real Estate Supply

Real estate developer Ahmed Omar Basoudan said the importance of these contracts extends beyond simply making land available to investors.

They also create opportunities to develop integrated real estate assets combining residential, commercial, office and recreational uses, increasing the economic value of land and improving its utilization.

Speaking to Asharq Al-Awsat, Basoudan explained that bringing design, construction, operation and maintenance together under a single investment framework allows for more integrated developments.

It also creates a stronger link between construction quality, operational efficiency and long-term sustainability.

At the broader market level, he said, the model could help diversify real estate offerings, particularly in major cities experiencing rapid urban expansion and rising demand for residential, commercial and office space.

The participation of new developers and operators could also strengthen competition and improve the quality of projects and services.

Moreover, the approach could create integrated mixed-use urban destinations that meet residents' needs and support economic activity, rather than relying solely on conventional real estate development.

 

Replicating the Model

 

According to Basoudan, the success of this investment model will depend on how effectively contracts are structured, how risks are allocated between government entities and investors, and how clearly development, operation and maintenance obligations are defined.

Equally important, he said, is striking an appropriate balance between investment returns and the public interest.

Basoudan believes extending the model to other municipalities and regions could create an additional channel for attracting domestic and international investment.

It could also strengthen private-sector participation in urban development, in line with Saudi Vision 2030 objectives to diversify the economy and improve the efficiency of government asset management.


Gold Rallies as Dollar, Treasury Yields Soften after US Midterm Results

Gold chips displayed at a state-owned gold retail store in Surabaya, East Java (AFP)
Gold chips displayed at a state-owned gold retail store in Surabaya, East Java (AFP)
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Gold Rallies as Dollar, Treasury Yields Soften after US Midterm Results

Gold chips displayed at a state-owned gold retail store in Surabaya, East Java (AFP)
Gold chips displayed at a state-owned gold retail store in Surabaya, East Java (AFP)

Gold climbed to its highest level in over two weeks on Thursday as the fallout from the US midterm election results rippled through the global financial and oil markets.

Spot gold rose 1.6% to $4,124.89 per ounce by 0752 GMT. It touched $4,146.63 per ounce, its highest level since October 20, earlier in ‌the session.

Bullion ‌climbed about 3.4% on Wednesday, its biggest ‌daily gain ⁠since August 19.

US ⁠gold futures for December delivery climbed 1.5% to $4,135.40, Reuters said.

A weaker dollar and lower Treasury yields have helped gold recover above the key $4,000 level, though holding above that threshold remains crucial for the recovery outlook, said Linh Tran, market analyst at XS.com.

"If investment flows and yield movements continue to provide support, gold could stabilize ⁠above $4,000, also opening up an opportunity for a ‌recovery toward $4,200, followed by $4,400."

Oil prices ‌were slightly higher after earlier falling for a fourth day on ‌expectations that the losses US President Donald Trump's Republican Party ‌suffered in congressional elections this week may reduce the risk of further escalation of the US-Israeli war with Iran.

Lower energy prices ease inflationary pressures, reducing expectations that the central bank will keep interest rates higher ‌for longer, supporting the appeal of non-yielding bullion.

The dollar slid to its lowest in more ⁠than a ⁠month, and 10-year US Treasury yield fell to its lowest since September 10.

A weaker dollar makes greenback-priced bullion more affordable for holders of other currencies.

Market participants now await the US non-farm payrolls report on Friday to further gauge the Federal Reserve's monetary policy outlook.

Meanwhile, Citi has a 0-3 month price target of $4,500 per ounce for gold, the brokerage said on Wednesday, as it sees substantial upside potential if the Strait of Hormuz reopens and the Yemen/Saudi conflict de-escalates.

Among other metals, spot silver rose 0.8% to $52.63 per ounce, platinum gained 1.2% to $1,514.20 and palladium climbed 2.2% to $1,026.83.