By Greg Torode and Antoni Slodkowski

HONG KONG/BEIJING (Reuters) – New U.S. president Donald Trump inherits U.S.-China relations, which were reset last year by presidents Joe Biden and Xi Jinping to lift diplomatic nadir ties in the wake of Covid-19 and Taiwan tensions.

Official talks are taking place on a number of critical issues, but regional diplomats and analysts say these channels, which are key to managing tense relations, could lead to a falling out with Trump in the White House. These include:

DEFENSE

Chinese and Philippine coast guards and fishing vessels face off almost weekly in the disputed South China Sea, while improved communications between the two militaries help control tensions in regional hotspots as China’s air force continues to test Taiwan’s defenses with combat-ready patrols near the island happened. .

Analysts say more work is ahead to make them resilient in the face of China’s military modernization and deployments that have established U.S. traditional dominance in the Asian arena.

Some fear that military ties may be the first to break in the event of new turbulence; This marks almost two years of military standoff after then-House Speaker Nancy Pelosi visited Taiwan in August 2022.

Communication on a number of defense fronts has gradually improved since Xi and Biden agreed to deepen relations during their face-to-face meeting in November 2023.

Biden’s national security adviser Jake Sullivan had a rare meeting with Xi’s key military adviser Zhang Youxia during three days of talks in Beijing in August. He also frequently held intense meetings with top diplomat Wang Yi.

Initial talks between field-level commanders in September reflected a long-standing U.S. effort to stabilize military ties and clear up misunderstandings amid broader regional tensions.

Some analysts say the U.S. Indo-Pacific Command in Hawaii will likely maintain deployments at current levels, but short-term uncertainty about Trump’s approach will be keenly felt by Chinese leaders and military commanders alike.

“In this scenario, I would expect the military leadership to be much more vigilant in their deployments around flashpoints such as the Taiwan Strait, the South China Sea and disputed areas with Japan,” said Alexander Neill, a Singapore-based security analyst.

“Leadership doesn’t like unpredictability,” added Neill of the Hawaii Pacific Forum.

Shelved talks on China’s growing nuclear weapons program will likely be another area to examine in the coming months; The Biden team is eager to move forward, but Beijing has been reticent.

Some analysts say Beijing, which has a much smaller arsenal than those of the United States and Russia, sees little positive development in such talks.

“It is telling that even during the current moderate thaw between Washington and Beijing, Beijing still closed arms control talks with Washington earlier this year,” said Jon Czin, a foreign policy expert at the Brookings Institution.

FENTANIL

After Xi and Biden agreed to continue joint efforts at a meeting on November 23, there was incremental but visible progress in cooperation in stopping the illicit traffic of chemicals used to produce deadly fentanyl.

The United States, where fentanyl use is the leading cause of death, has pushed China for tougher law enforcement, including tackling illicit financing and imposing greater controls on the chemicals.

In June, China’s attorney general urged law enforcement to focus on combating drug trafficking after Beijing and Washington announced a rare joint investigation into drugs.

In August, days after a meeting of the joint counter-narcotics working group, China announced it would tighten controls on three chemicals needed to produce fentanyl.

CLIMATE CHANGE

Climate diplomacy between the world’s two largest greenhouse gas emitters has helped build momentum for global agreements such as the Paris Agreement and played a key role in building consensus at last year’s COP28 meeting in Dubai.

With Trump expected to withdraw from the Paris agreement for the second time, the two countries’ cooperation on climate issues will end, but subnational initiatives with the state of California and other states are expected to continue.

Trump’s imminent return to the White House could also undermine efforts to persuade China to adopt more ambitious 2035 emissions reduction targets; Beijing is already upset with US “green trade barriers” on electric vehicles, batteries and solar panels.

ECONOMY

Less prominently, the two rivals hold regular meetings between working groups on economic and financial issues, which launched in September 2023.

At one such meeting, which lasted two days in September in Beijing, Chinese officials expressed “serious” concerns about additional US tariffs, investment restrictions and Russia-related sanctions.

Zhao Minghao of Fudan University’s Institute of International Studies said the broader dialogue effort was important and had made “meaningful progress.”

“But from Beijing’s perspective, there are legitimate concerns about these dialogues that could be halted or paused again under a Trump presidency,” he added.

(This story has been corrected to correct analyst’s name in paragraph 24)

(Additional reporting by Antoni Slodkowski and Laurie Chen in Beijing and David Stanway in Singapore; Editing by Antoni Slodkowski and Clarence Fernandez)