[Financial News New York = Lee Byung-chul] The summit between the United States and China, widely seen as the biggest diplomatic event of the year, will be held in Beijing this week. Since the launch of the second Trump administration, the two countries have been locked in sharp confrontation. This summit could become a major turning point for the global economic order, with issues such as extending the Trade War truce, reshaping supply chains, and managing Taiwan risks all on the table. But the unexpected outbreak of a war between the United States and Islamic Republic of Iran in the Middle East has made the summit even more strategically important. The United States will negotiate with China, which now has greater economic strength and diplomatic influence than in the past. \r\n A New Variable from the Middle East War \r\n U.S. President Donald Trump and Chinese President Xi Jinping will hold a two-day summit in Beijing starting on the 14th. It will be their first meeting since last October in Gyeongju, South Korea. The summit had originally been scheduled for early April, but was delayed by about a month after the outbreak of war in the Middle East. The key agenda items are the Middle East war, the Taiwan issue, and trade tensions. The United States is currently struggling in ceasefire negotiations with Islamic Republic of Iran. Its strategy of pressuring the Iranian economy by blocking the Strait of Hormuz has not been as effective as expected. China, which has significant influence over Iran, has emerged as an important mediator and bargaining chip for both Washington and Tehran. U.S. Secretary of the Treasury Scott Bessent said in a Fox News interview on the 4th that China should play a role in resolving the Strait of Hormuz crisis. U.S. Secretary of State Marco Rubio also said at a press briefing the next day that China should exert direct pressure on Iran. In particular, the United States designated four entities as sanctions targets on the 9th, including three Chinese companies and one Iranian institution. The targets were Chinese satellite ground station operator Dears Eye, geospatial information company Mizavision, satellite imagery firm Changguang Satellite Technology, and the Iran Defense Export Center. The U.S. government said these companies provided satellite images to Iran, helping identify the locations of military facilities belonging to the United States Forces Korea and its allies. Changguang Satellite Technology was specifically accused of providing imagery related to U.S. military facilities in the Middle East during Operation Epic Fury, the U.S. military operation against Iran. \r\n A Power Struggle Over Taiwan \r\n Iran is also stepping up diplomatic contact with China. Iranian Foreign Minister Abbas Araghchi visited Beijing on the 6th. In talks with Araghchi, Chinese Foreign Minister Wang Yi emphasized the need to build a peace and security framework led by regional countries, signaling Beijing's intention to expand its influence in the process of reshaping the future order in the Middle East. Victor Cha, a professor of Chinese political economy at the University of California, San Diego, told the Financial Times (FT) that "China, as the largest buyer of Iranian crude, can exert considerable influence over Iran and use that to strengthen its bargaining power." In the end, China is likely to use the Middle East war as leverage to extract concessions from the United States on Taiwan. Beijing is expected to seek a written commitment opposing Taiwan independence, along with a reduction or restriction in U.S. arms sales to Taiwan. Richard Bush, a senior fellow at the Brookings Institution's Center for Asia Policy Studies (CAPS), said in a recent report that "the Taiwan issue may be pushed relatively lower on the agenda as tariffs and export controls take precedence, but for China it remains a core issue that cannot be ignored." \r\n A Possible Extension of the Trade War Truce \r\n Trade tensions are also a key agenda item at the summit. Ahead of the November midterm elections, President Trump is hoping for visible diplomatic gains, including expanded Boeing aircraft sales, increased exports of U.S. soybeans, and the creation of a new trade committee to manage bilateral trade disputes. Boeing CEO Kelly Ortberg will also accompany the trip to China. China is expected to demand tariff relief and easing of export restrictions on advanced semiconductors. Current U.S. tariffs on Chinese goods range from 7.5% to 25% for ordinary items, but much higher rates are being imposed on strategic industries, including 100% on EVs and 50% on semiconductors and solar products. In addition, exports of high-performance artificial intelligence semiconductors to China remain tightly restricted. China is also likely to use rare-earth element supply chains as a bargaining chip. Market expectations are leaning toward a limited agreement rather than a comprehensive trade deal, such as a halt to further tariff hikes and expanded purchases of U.S. agricultural products and aircraft. Neil Thomas, a China expert at the Asia Society Policy Institute (ASPI), told the FT that "the personal relationship between the two leaders and the experience of this visit are very important for the broader U.S.-China relationship," adding that "because the two men are the final decision-makers in their respective foreign policies, the outcome of this summit is likely to shape the direction of future ties." \r\n \r\n\r\n \r\n \r\n pride@fnnews.com Lee Byung-chul Reporter