Fresh Trade Talks Begin as China and US Eye Truce Extension
Negotiations between the United States and China have resumed, signaling renewed diplomatic engagement between the world’s two largest economies as officials on both sides aim to extend their ongoing trade truce by another 90 days. The meetings, held this week in Stockholm, bring together key figures from each nation: U.S. Treasury Secretary Scott Bessent and China’s Vice Premier He Lifeng, both of whom have played instrumental roles in past rounds of trade diplomacy.
The revival of talks comes at a critical time, just as President Donald Trump announced a tentative agreement on tariffs with the European Union. This momentum has created a cautiously optimistic environment for progress in the Beijing-Washington discussions. The existing tariff truce, which temporarily reduced levies on hundreds of goods crossing the Pacific, is set to expire on August 12 unless extended.
Tariff Truce Nearing Deadline
Tensions between the United States and China have escalated sharply since January, when the Trump administration reentered the White House and quickly implemented steep tariff hikes, pushing bilateral import taxes above 100%. A breakthrough came earlier this year after senior representatives met in Geneva and London, leading to a temporary cessation of hostilities and a 90-day freeze on new tariff actions.
Last week, Secretary Bessent suggested that negotiations with China were moving in a “very good place,” hinting at the possibility of securing a second truce. Media reports have bolstered this narrative, indicating that negotiators from both sides expect an extension of the current agreement through mid-November.
At the same time, there are growing signs that Washington has paused its technology export restrictions to China—a gesture widely interpreted as a means to preserve the fragile diplomatic progress and to pave the way for a potential face-to-face between Trump and President Xi Jinping later this year.
Tech and Tariffs Still a Point of Contention
Central to the ongoing talks are concerns over semiconductors and other high-tech components used in artificial intelligence. The U.S. government has repeatedly expressed alarm that advanced American-made chips could be repurposed by China’s military or leveraged by its commercial sector to outpace U.S. innovation.
Despite these concerns, recent measures to soften technology restrictions suggest that Washington is prioritizing broader trade goals over sector-specific enforcement—at least in the short term. With both nations seeking to avoid a breakdown in talks, the strategy appears aimed at ensuring the truce is preserved while delicate issues continue to be negotiated in parallel.
Global Trade Tensions Easing Slightly
The restart of US-China trade negotiations comes in the wake of other significant developments in U.S. foreign trade policy. Just days ago, President Trump reached new trade agreements with both the European Union and Japan. The deal with Tokyo includes a $550 billion investment in the U.S. economy and a new tariff structure that avoids the previously threatened 25% rate, settling instead at 15%. Britain also managed to negotiate a 10% tariff rate—the lowest thus far among recent U.S. trade partners.
These agreements have sparked cautious optimism that international trade flows might stabilize, at least temporarily. No immediate breakthroughs are anticipated in the current round of talks with China, but officials remain hopeful that the extension of the truce will mitigate economic uncertainty and allow for continued dialogue.
The coming days will prove crucial in determining whether Washington and Beijing can maintain their tentative peace or whether another wave of tariffs will once again disrupt global commerce.
