Why China May Finally Be Giving Up TikTok
When the news broke last week that TikTok had agreed to sell its American operations, and President Trump shared his enthusiastic reaction, many initially saw it as a victory for the U.S. and a significant concession from China. After all, Beijing had resisted such demands for five years, frequently calling U.S. divestment requirements discriminatory.
However, a conversation with my colleague Lily Kuo offered a different perspective. She explained that if China is making a concession, it’s doing so from a position of strength. TikTok, she argued, has become a relatively minor bargaining chip in a much larger, more crucial negotiation.
Should China proceed with the sale of TikTok (the deal’s specifics are still being finalized), it would effectively create space for discussions on issues Beijing values most: trade tariffs, advanced technology, and the status of Taiwan.
During his first term, Trump was a staunch advocate for banning TikTok in the U.S., citing national security concerns about China potentially using the platform for espionage and disinformation. China, however, refused to allow American investors to control the platform’s powerful recommendation algorithm. This led the U.S. Congress in spring 2024 to pass a law requiring ByteDance, TikTok’s Chinese parent company, to sell or face a ban.
Yet, a twist emerged: Trump publicly opposed Congress’s action. By then, he was engaged in his re-election campaign, and TikTok had become a valuable tool for connecting with young voters. Moreover, a prominent Wall Street financier and major donor to Trump was also a significant investor in ByteDance.
Since taking office this year, Trump has repeatedly extended TikTok’s deadline through executive orders. Simultaneously, he escalated a trade war with China, imposing extensive tariffs on Chinese goods. China has reciprocated with its own tariffs and leveraged its control over critical minerals to impact the U.S. economy.
In recent months, however, both nations have engaged in negotiations and appear to have found common ground. China, perceiving itself to hold maximum leverage, now sees this as the opportune moment to play the TikTok card.
“It looks like weakness,” Lily observed, “but it’s actually a tactical move to focus Trump on the things that China cares most about.”
This arrangement grants Trump a win on an issue personally important to him – preserving the app he believes contributed to his re-election – while China cultivates a positive environment for discussing its own priorities. China seeks tariff relief, a relaxation of export controls on advanced chips, and reduced U.S. support for Taiwan. Furthermore, it desires an in-person meeting between Trump and President Xi Jinping, ideally in China, to manage public perception.
Such a meeting is now highly probable, according to Lily. Concessions on these other critical issues, previously thought impossible, now seem within reach.
If the plan unfolds as expected, American owners will control TikTok. Trump recently suggested that Rupert Murdoch’s Fox Corporation might be among the potential investors. While this could mitigate a national security threat (though some question if the deal’s specifics go far enough), the lingering question is whether these gains will come at the cost of concessions on advanced AI technology or even Taiwan – issues typically considered more vital to U.S. national security than a social media app.
“The Chinese side is fairly optimistic because they see Trump as transactional,” Lily noted. “Trump likes a good deal.”
Global Developments
Recognition of Palestinian Statehood
Britain, Canada, and Australia announced yesterday their formal recognition of Palestinian statehood, intensifying pressure on Israel and creating diplomatic discord with the Trump administration.
While this coordinated action will further isolate Israeli Prime Minister Benjamin Netanyahu diplomatically, it is unlikely to immediately alter the situation on the ground.
At the U.N. today, France aims to rally approximately 140 other nations to recognize Palestinian statehood as part of a two-state solution after the conflict in Gaza concludes. The plan, however, lacks a crucial element: any indication of support from Israel or the U.S. Understanding Palestinian statehood offers further context.
Ask A Correspondent: Your Questions About Tariffs, Answered
This week, we welcome Ana Swanson, who covers trade and international economics from Washington, to answer your questions about tariffs. Thank you to all the readers who submitted insightful inquiries.
What effects are the tariffs having on the prices of goods in the U.S. now? Does the public see tariffs as a stealth tax, or are people content with this as a means of funding government spending? — Adam Tattersley, Britain
Ana: The impact of increased tariffs on consumer prices has taken months to materialize, but we are now beginning to observe this trend. Government data indicates that prices for goods heavily affected by tariffs, such as home furnishings, toys, and apparel, are rising more rapidly than other products.
Companies have been cautious in raising prices, partly due to concerns about economic weakness and consumer willingness to purchase. They also stockpiled products before the tariffs took effect. However, economists warn that businesses cannot absorb the full cost of tariffs indefinitely.
American public opinion on tariffs often aligns with party lines, with Republicans generally viewing them more favorably. Nevertheless, even some Trump voters express skepticism. Polling in April revealed that nearly 90 percent of Americans surveyed believed tariffs would lead to higher prices, while August polling indicated that 61 percent of Americans disapproved of them.
More Top News
U.S.: Tens of thousands gathered under tight security in an Arizona stadium for a memorial honoring conservative activist Charlie Kirk. Trump and Vice President JD Vance were scheduled to speak. We have live updates.
Ukraine: Kyiv’s forces are achieving modest gains in the Sumy region, which could help counter Moscow’s narrative that Russian advances are unstoppable.
Philippines: Protesters demonstrated in Manila, accusing the government of misappropriating billions of dollars allocated for flood relief efforts.
Immigration: Trump signed a proclamation implementing a $100,000 fee on new H-1B visas, causing disruption for Wall Street and tech firms.
Nepal: The new prime minister has established a commission to investigate the killings of over 70 individuals by armed forces during the recent student uprising.
Chad: As U.S. aid diminishes, a refugee camp’s maternity tent is losing staff, endangering pregnant women.
Sports News
- Athletics: Experience the 2025 World Athletics Championships through 17 captivating photos.
- Football: Skeletal tracking is emerging as the next frontier in player analytics.
- Formula 1: Oscar Piastri described his Azerbaijan Grand Prix weekend as “messy” after a jump start and a crash impacted his F1 title lead.
Morning Read
Three elderly nuns in Austria, the last of their order, were heartbroken after being moved from their abbey. One cried and became bedridden due to their misery. Collaborating with former students, the sisters devised a plan to return to their cherished former home.
Many details of the story remain debated, including whether they were forced to move or if their old convent was truly unsafe. However, one fact is clear: their tale has captivated news and social media. Read more, and watch the nuns discuss their return in this video.
Conversation Starters
New moms, old rituals: In Mexico, midwives are revitalizing ancestral practices, such as shawl-wrapping and herbal baths, to support women postpartum.
Soul food in Paris: Mashama Bailey, a renowned American chef, is bringing authentic Southern cooking to the French capital.
Moody tortoise: Recent research reveals that reptiles can experience lasting emotional states, challenging long-held beliefs about their intelligence.
Arts and Ideas
Can These Islands Adapt to Airbnb?
The Galápagos Islands, off the coast of Ecuador, are famous for their unique wildlife, including sea lions that nap at bus stops and remarkably tame birds. It’s easy to understand why Charles Darwin found the archipelago so extraordinary during his 1835 visit.
Since the pandemic, hundreds of residents have started renting out rooms on Airbnb, some for as little as $8 a night. While this has made the islands more accessible than ever, critics argue that the surge in short-term rentals is altering the very ecosystem that thousands of visitors come to admire. Read more.
Recommendations
Bake: Discover a delicious dairy-free version of flan, a beloved dessert throughout Latin America.
Read: In her new book, Kamala Harris reflects on her 2024 campaign and asserts that she simply ran out of time.
Walk: Experts share valuable, blister-free tips for effectively breaking in new shoes.
Play: Challenge yourself with Spelling Bee, the Mini Crossword, Wordle, and Sudoku. Explore all our games here.
That’s it for today. See you tomorrow. — Katrin
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