The world’s two largest economies are once again attempting to defuse trade tensions that have roiled global markets for nearly a decade. The United States and China are holding high-stakes talks in London today in what is their first formal face-to-face engagement since Donald Trump’s return to the White House.
The discussions come after months of tariff escalations, export controls, and public rhetoric that has pushed US-China ties to their most fragile point in years. While few expect a sweeping agreement from this single meeting, the choice of venue and the composition of both delegations underscore the seriousness with which both sides are approaching what could be the start of a prolonged negotiation cycle.
A reset attempt
Announced just days after President Trump and Chinese President Xi Jinping held their first official phone call since Trump’s return to office, the London summit signals an effort by both powers to resume dialogue after months of disruption.
Leading the American delegation will be Treasury Secretary Scott Bessent, Commerce Secretary Howard Lutnick, and Trade Representative Jamieson Greer. All three are close allies of the Trump administration and have been involved in reworking US industrial and trade policy since early 2025. On China’s side, Vice Premier He Lifeng will spearhead the negotiations – an experienced economic policymaker who also led Beijing’s team in the May Geneva talks that resulted in a temporary tariff truce.
The meeting follows a turbulent period in global trade. Since Trump’s re-election, Washington has reimposed tariffs on over $400 billion worth of Chinese imports, citing intellectual property theft, unfair subsidies, and national security concerns. China has responded with countermeasures of its own, targeting critical US exports and tightening its grip over the global supply of rare earth elements and strategic minerals—raw materials vital to the world’s semiconductor, EV, and defense industries.
Key issues on the table
One of the most contentious flashpoints is China’s near-monopoly on rare earths and other critical minerals. The United States wants Beijing to ease export restrictions and guarantee supply continuity to key American industries. China, however, has argued that the US cannot demand open access while actively attempting to decouple its economy and relocate supply chains to allied nations. Any movement on this front would likely involve tightly controlled export schedules, volume caps, or joint certification mechanisms.
Another major issue is the Biden-era legacy of advanced technology export controls, which Trump has largely retained and even expanded. The US has blocked China’s access to cutting-edge chip design tools, lithography systems, and AI-related software, citing concerns over military dual use. In retaliation, China has made it harder for foreign firms to operate freely, enforcing data localisation rules and subjecting foreign-made chips to new security reviews. These tit-for-tat moves have not only hurt bilateral tech flows but also rattled global firms caught in the middle.
The question of tariff rollbacks will also loom large. Although both sides agreed in Geneva to pause new tariffs for 90 days, many of the Trump-era duties remain in place, including tariffs as high as 145% on some Chinese goods. US negotiators are unlikely to offer significant relief unless China commits to verifiable reforms in state subsidies, procurement policies, and market access for American firms. Beijing, meanwhile, is expected to demand that existing tariffs be rolled back before offering any concessions.
Another topic expectedly to find a major mention is Trump’s newly revived immigration agenda, which has deep implications for U.S.–China relations beyond the realm of trade. Since returning to office, Trump has reimposed and expanded visa restrictions on Chinese nationals—particularly targeting students, researchers, and employees in sensitive tech sectors. His administration argues the move is necessary to prevent espionage and intellectual property theft. Critics, however, say the policies are xenophobic and risk undermining US universities and tech firms that rely heavily on Chinese talent.
The outcome of the London talks could reverberate far beyond Washington and Beijing. Many developing economies, particularly in Southeast Asia and Africa, have benefited from US-China tensions as manufacturers look for alternative production hubs. However, prolonged uncertainty threatens to destabilise commodity markets, increase inflationary pressures, and disrupt the rollout of green technologies that depend on Chinese-made components.
Europe, meanwhile, has largely tried to stay neutral but is watching the talks closely. As a major trade partner to both the US and China, the EU has an interest in stable global commerce and is wary of being caught in the crossfire, particularly if disputes spill into areas like digital trade, automotive tariffs, or energy.
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