Trade and AI: Intense U.S.-China Meetings Ahead of Presidential Summit

U.S. Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng will meet on Sunday to pave the way for potential agreements on artificial intelligence, tariffs, and critical minerals, ahead of a highly significant summit this week in Washington between U.S. President Donald Trump and his Chinese counterpart, Xi Jinping, according to Reuters.

The meetings, scheduled to begin at 10:30 a.m. local time (14:30 GMT) at the headquarters of JPMorgan Chase in Manhattan's borough, will also include U.S. Trade Representative Jamison Greer and are expected to last throughout the day.

The preparatory talks aim to reach initial understandings on several key contentious issues, including artificial intelligence technologies, tariffs, and supply chains for critical minerals.

Topics to be discussed include establishing a temporary trade truce between the U.S. and China set to expire on November 10, flows of magnets made from rare earth elements and Chinese critical minerals (which U.S. officials view as insufficient), and possible safeguards for artificial intelligence following reports of major security breaches involving AI models.

Analysts believe the most likely outcome will be an agreement between Washington and Beijing on small steps to demonstrate their continued commitment to avoiding escalation in fragile trade relations, which carry serious implications for the global economy.

In this context, Anna Ashton, a specialist in Chinese trade affairs and founder of Ashton Intelligence, said: "I think there will be some showcase of outcomes simply because it's a forthcoming presidential summit, but I don't feel we're on the verge of a breakthrough. I believe maintaining the status quo is the best general expectation for both sides."

Many of the issues that He and Bessent and Greer must address on behalf of Trump and Xi extend the outcomes of the leaders' meeting in Beijing last May, including efforts by both sides to reduce tariffs on non-strategic goods, China's pledge to increase annual purchases of U.S. agricultural products by $17 billion, and commitments to buy over 200 Boeing aircraft.

The meeting between Bessent and He follows the approach taken over the past 16 months, during which the three officials have held meetings in European and Asian cities to prepare for potential agreements between Trump and Xi. These efforts included the November 2025 consensus truce reached in Busan, South Korea, which capped U.S. tariffs on Chinese goods during Trump’s second term at around 20%, after mutual escalation had driven them to record highs exceeding 100% on both sides.

Later, the U.S. Supreme Court invalidated tariffs imposed by Trump under the National Emergency Powers Act, including those tied to the smuggling of the drug fentanyl.

In response, the Trump administration worked to reinstate those tariffs under new authorities; this included reimposing a 12.5% tariff on Chinese goods based on allegations of forced labor. The administration is also finalizing another investigation targeting tariffs aimed at curbing excess industrial production capacity, which Washington claims is rampant in China.

Under that truce, China pledged to resume flows of critical minerals to consumers in the United States and globally. However, a senior U.S. official told reporters on Friday that China’s performance on this issue "has not met expectations," and it will be discussed ahead of the Trump-Xi summit.

New Talks on Artificial Intelligence

Discussions between Bessent and He on artificial intelligence carry significant weight, given that the United States and China are the two dominant powers driving the global development and adoption of advanced AI tools. Rare earth elements also play a vital role in manufacturing advanced semiconductor technologies that power AI systems.

Bessent said on Friday he expects the talks to cover "open-weight and closed-weight AI models." Open-weight models are AI systems that make their core components available to the public, allowing users to download and customize them for specific tasks.

Chinese open-weight models are increasingly adopted by American companies, as they may be less costly than closed-weight AI tools such as those developed by U.S. firms like Anthropic and OpenAI.

Bessent added in a statement about discussions with China: "The United States remains the leader in AI, and we are open to talks to avoid shared risks and prevent fragmentation of our systems."

He called on both the U.S. and China to agree on "protective safeguards" for AI aimed at preventing powerful models from falling into the hands of non-state actors with malicious intent.

Reducing Tariffs

Last May, the U.S. and Chinese sides agreed to launch talks to reduce tariffs on non-strategic goods under a mechanism known as the "Trade Council," along with a similar forum to address specific investment issues.

While the Trump administration has tightened restrictions on U.S. corporate investments in certain sectors within China, Reuters reported on Friday that the administration is developing rules allowing American pharmaceutical companies to invest in promising Chinese real estate and enter licensing deals.

Meanwhile, China’s Ministry of Commerce announced on Saturday that He will also lead a delegation of Chinese companies on a visit to the United States to participate in economic and trade consultations preceding the summit.

This announcement of the business delegation—mirroring the group of top U.S. company executives led by Trump to Beijing in May—comes as Trump expressed openness to building factories for Chinese automakers within the United States, while U.S. auto industry groups urged Trump on Friday to maintain a de facto ban on sales of Chinese vehicles in the country for national security reasons.

According to senior U.S. officials quoted by Reuters, Trump is preparing to receive Xi at Andrews Joint Base upon his arrival in the United States, with the visit including formal welcome ceremonies, a military parade, a state dinner at the White House, and a bilateral meeting between the two presidents.

Xi’s visit to Washington follows Trump’s trip to China last May, when the two leaders agreed to continue building a relationship described by the White House as "strategic stability," with Trump announcing then that he would host his Chinese counterpart in the United States later that fall.