Xi warns Trump that mishandling of Taiwan could lead to conflict

China's Xi Jinping told chairman Donald  ruff that merchandise talks were making get along at the take up of a two-day summit on Thursday but warned that disagreement over Taiwan could send relations down a dangerous path.

The Chinese leader's remarks set the stage for what Trump described as possibly the "biggest summit ever" following a pomp-filled reception at Beijing's imposing Great Hall of the People.

With Trump's approval ratings dented by his Iran war, the first visit by a U.S. President to America's main strategic rival since his last trip there in 2017 has taken on added significance.

After an opening ceremony that featured an honour guard and throngs of children excitedly waving flowers and flags, Xi began the summit by telling Trump that stable relations between the world's two biggest economies benefit the entire world.

"When we cooperate, both sides benefit; when we confront each other, both sides suffer," he said in brief remarks that were open to media.

"You're a great leader, sometimes people don’t like me saying it, but I say it anyway," Trump responded. "There are those who say this may be the biggest summit ever," he added.

Weakened Trump in China for high stakes talks with Xi

Xi said negotiations between U.S. And Chinese economic and trade teams in South Korea on Wednesday had reached "overall balanced and positive outcomes," according to a readout by China's foreign ministry.

The negotiations had aimed to maintain the trade truce struck between Trump and Xi last October and establish mechanisms to support future trade and investment, officials with knowledge of the matter said.

Xi also broached the subject of Taiwan, the democratically governed island claimed by China and armed by the United States.

The Chinese leader told Trump that Taiwan was the most important issue in U.S.-China relations and if handled poorly could lead to conflict and an extremely dangerous situation, according to the Chinese readout of the talks, which concluded after a little over two hours.

Trump did not respond when a reporter later shouted a question about whether they had discussed Taiwan as he posed for photos with Xi at the Temple of Heaven, a UNESCO World Heritage Site where emperors once prayed for good harvests.

The leaders also agreed to expand cooperation in trade and agriculture and exchanged views on the situations in the Middle East, Ukraine and the Korean peninsula, according to state broadcaster CCTV.

Trump and Xi will later attend a state banquet before taking tea and lunch together on Friday.

Joining Trump on the trip are a group of CEOs looking to resolve issues with China, including Elon Musk and Nvidia CEO Jensen Huang, a late addition. Trump has said his first request to Xi will be to "open up" China to U.S. Industry.

Trump introduced the executives to Xi during the talks. China's door of openness will only open wider, and U.S. Companies are deeply involved in China's reform and opening-up, Xi told Trump, according to the Chinese readout.

The power dynamic has shifted since Trump's last visit to Beijing when China went out of its way to lavish Trump and buy billions of dollars' worth of U.S. Goods, said Ali Wyne, senior adviser for U.S.-China relations ​at International Crisis Group, a conflict-prevention think-tank and advocacy group.

Back then "China was trying to persuade the United States of its growing status.... This time around it's the United States, unprompted, ⁠of its own volition, that is acknowledging that status," ⁠Wyne said. He added that Trump revived the term 'G2,' referring to a superpower duo, when he ‌last met Xi on the sidelines of an APEC meeting in South Korea in October.

This week's meetings will provide plenty of face time between the leaders. According to the White House, they are scheduled to hold talks at the Great Hall of the People, tour the UNESCO World Heritage Site Temple of Heaven and attend a state banquet on Thursday, before taking tea and lunch together on Friday.

Trump enters the talks with a weakened hand. U.S. Courts have hemmed in his ability ⁠to levy tariffs at will on exports from China and other countries. The Iran war has also boosted inflation at home and escalated the risk that Trump's Republican Party will lose control of one or both legislative branches in November's midterm elections.

Trump downplays tension ahead of China trip

Though the Chinese economy has faltered, Xi does not face comparable economic or political pressure. Nevertheless, both sides are eager to maintain a trade truce struck last ‌October, in which Trump suspended triple-digit tariffs on Chinese goods and Xi backed away from choking global supplies of rare earths, which are vital in making items from electric cars to weapons.

They are also expected to discuss forums to support mutual trade and investment, as well as dialogue on AI issues.

Washington is looking to sell Boeing airplanes, farm goods and energy to China to cut a trade deficit that has long irked Trump, while Beijing wants the U.S. To ease curbs on exports of chipmaking equipment and advanced ​semiconductors, officials involved in the planning said.

Aside from trade matters, Trump is expected to encourage China to convince Tehran to make a deal with Washington to end the conflict. But analysts doubt that Xi will be willing to push Tehran hard or end ⁠support for its military, given Iran's value to Beijing as a strategic counterweight to the U.S.

U.S. Secretary of State Marco Rubio told Fox News aboard Air Force One that it was ⁠in China's interest to help resolve the crisis, as many of its ships are stuck in the Persian Gulf and a slowdown in the global economy would hurt Chinese ⁠exporters.

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