Former President Donald Trump announced that he and Chinese President Xi Jinping have reached an agreement regarding the future of TikTok’s operations in the United States. This welcome news came in the wake of a July phone call between the two leaders, where the two discussed several economic issues affecting both countries.
The newly approved deal will involve a consortium of U.S. firms, including Oracle, which will facilitate TikTok’s continued operation within the United States. The deal requires TikTok’s U.S. business to be sold to a consortium of American investors. This action ensures that TikTok’s operations will be more closely aligned with U.S. national security interests. The green-to-brown transition for this would be powered by algorithm tech licensed from ByteDance, the Chinese parent of TikTok.
Both Trump and now-departed Treasury Secretary Mnuchin stressed the strategic importance of the deal, with Trump declaring that TikTok has “tremendous value” to the U.S. economy. National security concerns Underlying this is President Trump’s original interest during his presidency, where he first advocated for a total ban on TikTok. At some point along the way, he started to flip. Now, he sees the social media platform as an essential part of his strategy toward winning the 2024 electoral campaign.
Since signaling intention to ban TikTok in January, Trump has delayed doing so four times already. The latest development on that ban was an extension of the deadline to implement it, now pushed back to December. In January, the U.S. Supreme Court upheld a law initially passed in early 2024 that mandates TikTok’s divestiture from ByteDance to remain operational in the U.S.
Considering this new development, Trump can’t even get excited about saving TikTok’s investors. He remarked, “The people that are investing it are among the greatest investors in the world.” He added that these investors would “do a great job – and we’re doing it in conjunction with China.”
The two leaders are scheduled to meet at the Asia-Pacific Economic Cooperation (APEC) summit in South Korea next month. This meeting coming up is a vivid illustration of their changing relationship. During the colorful campaign, Trump had announced plans to visit China in early 2024 to discuss bilateral ties and trade.
Their communication doesn’t stop at TikTok. Specifically, in June, Trump and Xi had a discussion involving China’s export of rare earth minerals. In the course of this dialogue, China committed to approve a specified number of export permits for U.S. firms. They added allowances for magnets made from these materials.
Trump described the call as “productive,” thanking Xi for approving Trump’s TikTok deal.
“I also agreed with President Xi that we would meet at the APEC Summit in South Korea, that I would go to China in the early part of next year.” – Donald Trump