Overview

• President Biden and Chinese President Xi Jinping's recent meeting has set a bottom line in their relationship, reducing uncertainty for businesses.
• The two leaders are committed to a form of decoupling based on reciprocity and mutual respect, which is seen as important for both countries and the global economy.
• The meeting signaled that both leaders want to avoid a downward spiral and cooperate where interests align, with full decoupling off the table and investment in China remaining permissible in non-sensitive industries.
• Despite the positive tone of the meeting, there is doubt about whether this atmosphere can last, particularly with the upcoming U.S. presidential election and Taiwan's elections.
• While the meeting didn't result in any major deliverables, it was successful in setting a new tone for cooperation and problem-solving, though companies are expected to continue focusing on derisking and diversifying supply chains.