U.S. President Joe Biden and Chinese President Xi Jinping arrived in Lima on Thursday, setting the stage for what is anticipated to be a consequential Asia-Pacific Economic Cooperation (APEC) summit. Both leaders are expected to meet on Saturday, likely marking their last direct exchange before U.S. President-elect Donald Trump’s inauguration in January. The shadow of Trump’s election victory looms large over the event, raising significant diplomatic concerns about the future of U.S.-China relations and global trade policies.
The Biden-Xi dialogue on Saturday is poised to be a highly anticipated session, given the shifting dynamics expected under Trump’s administration. Since his electoral win, Trump has signaled a more confrontational stance toward Beijing, a direction likely to mark a shift from Biden’s policy of cautious diplomacy and economic cooperation with China. As Trump prepares to assume office, the bilateral conversation between Biden and Xi will be closely observed worldwide, potentially foreshadowing future shifts in trade, military alignments, and regional influence.
A U.S. administration official, who spoke on the condition of anonymity, highlighted the importance of this interaction, noting that it would likely be the last in-person dialogue between Biden and Xi before Trump takes office. The official hinted at the “pressing need” for clarity on pressing issues, especially regarding trade policies, regional security, and the status of alliances crucial to the balance of power in Asia.
Since its establishment in 1989, APEC has provided a forum for the 21 participating economies, which jointly represent around 60% of the world’s GDP and 40% of global trade. With a mission centered on regional trade liberalization, the APEC summit was initially planned to focus on trade, investment, and inclusive economic growth.
However, Trump’s election victory has cast doubt over this agenda, especially regarding the future of multilateral trade agreements and the continuity of climate policies. Analysts and diplomats attending the summit acknowledge that Trump’s “America First” doctrine, marked by a protectionist economic approach and an emphasis on fossil fuels, threatens to upend the international cooperation fostered under Biden.
In advance of the summit, foreign ministers, including U.S. Secretary of State Antony Blinken, held a private session on Thursday to set the tone for the weekend’s discussions. Topics ranged from trade and investment to security concerns within the Asia-Pacific region.
Amid this atmosphere, Trump made headlines earlier this week by announcing that he would replace Blinken with Senator Marco Rubio, a known China hawk with strong views on Beijing’s political and economic maneuvers. Rubio’s appointment signals a probable hardening of U.S. policy on China, sparking further interest in Biden and Xi’s Saturday dialogue.
The summit will also welcome leaders from major economies, including Japan, South Korea, Canada, Australia, and Indonesia. Notably absent from the gathering is Russian President Vladimir Putin, despite Russia’s APEC membership. Putin’s absence has drawn attention, with many attributing it to the widening rift between Moscow and the West, further compounded by the ongoing war in Ukraine.
Throughout his campaign, Trump championed a protectionist economic agenda that emphasizes reducing America’s trade deficit and repatriating jobs. Among his most controversial proposals is a tariff plan, with potential levies of up to 60% on Chinese imports, aiming to address what he terms an “imbalance” in trade between the United States and China.
However, economists warn that such tariffs could harm the U.S. economy, potentially igniting a trade war that may disrupt global supply chains, increase costs for American consumers, and negatively impact key industries. For China, already grappling with an extended housing crisis and sluggish consumption, Trump’s approach could exacerbate existing economic challenges. Despite this, the Chinese government appears determined to project stability and strength, underscored by Xi’s commitment to Beijing’s Belt and Road Initiative, which aims to expand China’s influence in Latin America and other parts of the world.
On Thursday, Xi Jinping attended the inauguration of South America’s first Chinese-funded port in Chancay, a coastal city north of Lima. This new infrastructure project, financed under the Belt and Road Initiative, highlights China’s growing presence and influence in Latin America, a region historically under U.S. influence. The Belt and Road Initiative has seen China fund various projects across the continent, including railroads, energy facilities, and ports, fostering deeper economic and diplomatic ties with Latin American countries.
Xi’s visit to Peru has symbolic value as well, with his arrival at the presidential palace and a scheduled bilateral meeting with Peruvian President Dina Boluarte underscoring the importance of China-Peru relations. In an op-ed published by the state-run newspaper El Peruano, Xi emphasized China’s dedication to “true multilateralism” and advocated for a form of globalization that is “universally beneficial and inclusive.”
As Trump’s inauguration nears, Biden is taking steps to fortify alliances in Asia, crucial to counterbalancing China’s growing influence. On Friday, he is scheduled to meet with Japanese Prime Minister Shigeru Ishiba and South Korean President Yoon Suk Yeol. Both Japan and South Korea play critical roles in U.S. security policy in the region, particularly amid escalating tensions with North Korea and China’s assertive posturing in the Taiwan Strait.
Jake Sullivan, Biden’s National Security Advisor, confirmed the White House’s efforts to make the trilateral alliance between the U.S., Japan, and South Korea an “enduring feature of American policy in the Indo-Pacific.” Sullivan also disclosed that the three countries plan to announce the establishment of a secretariat to coordinate their alliance efforts, underscoring Washington’s commitment to the Indo-Pacific region despite anticipated shifts in U.S. policy under Trump.
Peru has ramped up security in anticipation of the summit, deploying over 13,000 armed forces personnel to maintain order. Protests have erupted in Lima, with transport workers and shop owners voicing frustrations over rising crime rates and what they describe as government neglect. The demonstrations reflect deeper social and economic discontent that has permeated Peruvian society, creating an atmosphere of tension as global leaders converge for the summit.
As host, Peru has endeavored to ensure that the summit proceeds smoothly, with authorities keen to showcase the country’s stability and commitment to regional cooperation. The increased security presence aims to mitigate potential disruptions as APEC leaders, including Biden and Xi, gather to address pressing international issues amid significant geopolitical uncertainty.
China is not the only country in Trump’s economic crosshairs. The president-elect has also threatened to impose tariffs of up to 25% on imports from Mexico unless steps are taken to address what he describes as an “onslaught of criminals and drugs” crossing the border into the United States. Mexico, a fellow APEC member, finds itself caught in the crossfire as Trump’s stance on border security and trade policy threatens to strain bilateral relations with one of America’s most significant economic partners.
Mexico’s President Andrés Manuel López Obrador has been vocal in defending his country’s contributions to the U.S. economy, emphasizing that any move toward higher tariffs could jeopardize the close trade relationship between the two nations. Analysts warn that such tariffs could disrupt the integrated supply chains linking the U.S. and Mexican economies, affecting sectors ranging from automotive manufacturing to agriculture.
