Trump and Xi Jinping deliberate on TikTok matter
In a significant development, US President Donald Trump has announced an imminent agreement on the sale of TikTok, the popular video-sharing app owned by Chinese company ByteDance. The agreement comes after a phone call between Trump and Chinese President Xi Jinping, which also addressed the ongoing trade dispute between the two nations.
The framework agreement stipulates that the US business of TikTok will be acquired or taken over as a joint venture predominantly by a consortium of American investors including Oracle, Silver Lake, and Andreessen Horowitz. Oracle is set to play a key role in managing data and privacy, while ByteDance retains a minority stake of around 20%.
The trade dispute between the US and China has been a contentious issue, with points of contention including competition in semiconductors, the export of chemicals for the drug Fentanyl from China, and US demands for more purchases of soybeans and Boeing aircraft. The dispute escalated when Trump increased tariffs on Chinese goods after taking office in January. In response, Beijing imposed counter-tariffs.
However, since May, there have been a series of limited agreements that have eased the trade conflict. The sale of TikTok, if it goes through, could be another step towards easing tensions.
The app would continue to use the algorithm of ByteDance, according to the framework agreement. The details of the agreement were not initially known after the phone call between Trump and Xi Jinping, but it is understood that the approval of the Chinese government for the previously negotiated framework agreement is considered one of the last hurdles.
Trump has been a vocal supporter of TikTok, expressing a liking for the app. He believes TikTok helped him in the election campaign, particularly in mobilizing young voters. However, the app was required to be sold by January 19, according to a US law passed last year. Trump granted an extension for the sale, which he has since repeatedly extended.
Trump tried to force a TikTok sale through pressure during his first term, but failed in US courts. The approval of the sale now hangs on the Chinese government's decision, which could potentially mark a thaw in the trade dispute between the US and China.
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