TikTok tops the trade talk

This report is from this week’s CNBC’s The China Connection publication, which brings you insights and evaluation on what’s driving the world’s second-largest economic system. You can subscribe here.

The distance is already seen. China has been silent on future conferences, at the same time as U.S. President Donald Trump introduced he and Chinese President Xi Jinping “agreed” to meet at the Asia-Pacific Economic Cooperation (APEC) summit in South Korea subsequent month.

The lack of particulars in the Chinese side’s statement “suggests that China is taking time to negotiate when U.S. is keen to have deals,” stated Winston Ma, adjunct professor at NYU School of Law, declaring that Beijing “said nothing about [an] APEC meeting.”

And then there’s China’s imprecise commitments to a tech licensing deal to keep TikTok alive in the U.S. — what Beijing calls a “resolution that complies with China’s laws and regulations.”

That contrasts with the fixed circulation of particulars from the U.S., now overlaying all the pieces from investors to board seats. A Politico report, citing an unnamed senior White House official, even claimed that the Trump administration is “100% confident” of a deal forcing Beijing-based ByteDance to spin off TikTookay’s U.S. operations.

Trump, nonetheless, might have preempted China’s coolness, saying in a Truth Social post Friday that he “appreciate[s] the TikTok approval” after his name with Xi, at the same time as Beijing stored its language imprecise.

China, in the meantime, has paired that coolness with a media blitz round its newest talks with the U.S. in Madrid, aiming to undertaking confidence as a tech energy following a showcase of recent weapons at the Sept. 3 military parade.

Context is all the pieces

In the runup to the Madrid talks held earlier this month, Beijing introduced new probes into U.S. chips — and, as the negotiations wrapped up on Monday, known as out Nvidia for alleged monopolistic practices. The subsequent night, the official night information broadcast — intently watched by officers and anybody attempting to learn the tea leaves on Beijing — included a segment highlighting China’s own semiconductors.

A day earlier than the Trump-Xi name, Chinese tech large Huawei additionally claimed its upcoming chip cluster can be extra highly effective than Nvidia’s.

All these information gadgets might seem like separate occasions. But in China, the place ceremonial timing issues, little occurs in a vacuum — any motion from a parade to chosen silence is calculated, typically tapping right into a political context that will seem unrelated to outsiders.

Notably, the newest debate over TikTookay coincided with China’s nationwide cybersecurity week, held on Sept 15-21. In previous years, the occasion has served as a platform for Beijing to advertise its nationwide safety agenda.

“Honestly, I really don’t see why the Chinese side would have any interest at all in divesting the … U.S. TikTok,” stated Blueshirt Group Managing Director Gary Dvorchak, whose work on Chinese listings in the U.S. has taken him between each international locations.

“What’s their achieve from it? They’re shedding management of considered one of the crown jewels of China’s technology,” he stated, declaring that the U.S. would disagree if China wished America to promote a part of Google or Facebook. “So why would they do something that we would never do?”

Despite the standoff over TikTookay, China hosted a bipartisan delegation of U.S. House Representatives this week, who arrived the weekend after the newest Trump-Xi cellphone name. It was the first such go to since 2019.

U.S. consultant Adam Smith, who led the journey, advised reporters Tuesday that in conferences with Chinese leaders, the two sides mentioned TikTookay as a problem to be resolved, however didn’t get into technical particulars.

“I think there’s going to be a lot of maybe positive noises” about TikTookay, Dvorchak stated, “but then in the end, at the last minute, it’s always going to fall apart.”

That stated, the TikTookay battle has grow to be half of a bigger recreation of political theatre. Beijing by no means confirmed Trump’s announcement early final week that he would communicate with Xi — till state media introduced on Friday that the two leaders have been talking.

But the extra elaborate the posturing by each side, the tougher it’s to realize a cope with optics that satisfies each side.

Apple iPhone 17 sees demand rise. The U.S. smartphone large may very well be poised for a comeback, as a couple of patrons in Beijing advised CNBC that extra locals are giving the iPhone a try this year because of its upgraded options. But the extremely anticipated iPhone Air isn’t coming to China but because of its eSIM design.

Chinese nationals hit with recent U.S. visa uncertainty. After the Trump administration stated that it might ask firms to pay $100,000 for brand spanking new H-1B visa candidates, many Chinese shared their frustration on social media. China was the second-largest beneficiary of H-1B visas final 12 months, accounting for 11.7% of authorised visa holders, based on U.S. homeland security data.

ByteDance valuation hopes climb. Investor conviction in the Chinese tech large has climbed since Washington and Beijing this week reached a framework agreement on the long-contested way forward for TikTookay in the U.S., a number of dealmakers advised CNBC. The newest valuation? $400 billion.

Hong Kong’s Hang Seng Index and mainland China’s CSI 300 have been up 1% and 0.88% respectively. Super Typhoon Ragasa introduced hurricane-force winds to excessive grounds and southern areas in Hong Kong, the Hong Kong Observatory famous. Conditions stay extreme, with heavy showers and thunderstorms anticipated.

Shares of Alibaba listed in Hong Kong jumped over 6% after CEO Eddie Wu stated Wednesday that the firm will enhance its funding in synthetic intelligence.

— Lee Ying Shan