What Beijing wants from a Trump-Xi meeting

2025-10-29 07:00:01

The United States and China held their fourth round of trade talks this year in Malaysia over the weekend as anticipation grew for Thursday’s meeting between the leaders of the world’s two largest economies.

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The big story

Suspense is growing ahead of the expected meeting between the US President on Thursday Donald Trump And the Chinese president Xi Jinping In South Korea, as both sides look to resolve escalating bilateral tensions.

As Trump was on his way to South Korea on the last leg of his three-nation Asian tour, he said he was looking forward to “a great meeting with Chinese President Xi, and a lot of problems will be resolved.”

“The relationship with China is very good,” Trump said from Air Force One on Wednesday. Beijing only confirmed that Xi will visit South Korea on Thursday.

Washington was previewing potential victories, from Delaying Chinese restrictions on rare earths to Deal about divesting TikTok’s US operations From Beijing-based parent company ByteDance. Once again, Beijing was much less vocal.

Trump’s optimism reflects a familiar pattern: US misunderstanding of China’s capabilities and interests.

Here’s what analysts told me that matter most to Beijing:

1. Stability

The Trump administration’s ad hoc approach contrasts with Beijing’s focus on stability.

“The Chinese fundamentally want a more stable and more favorable economic and trade relationship,” said Zichen Wang, a research fellow and director of international communications at the Beijing-based Center for China and Globalization think tank.

This is expected to include “some kind of ceasefire, so that there is no further mutual escalation from the United States and then countermeasures from China.”

2. Reducing customs tariffs

Beijing’s most practical request is for the United States to remove tariffs on Chinese goods. Tariffs more than doubled in just two weeks in April, before the two sides agreed to halt duties for 90 days. Expires in mid-November.

But the burdens still remain, especially since Trump threatened to do so New definitions Up to 100% could take effect next month.

However, just minutes before arriving in South Korea on Wednesday, Trump said he expected to reduce fentanyl-related tariffs on China ahead of his long-awaited meeting with Xi.

“Businesses need certainty. There’s no certainty right now,” said Cameron Johnson, senior partner at Shanghai-based consultancy Tidalwave Solutions. They “need stability in the tariff structure.”

Meanwhile, China is hedging – as its US exports decline, shipments of goods to other parts of the world are rising. Since the previous round of US-China tensions in 2018, Southeast Asia has overtaken the European Union as China’s largest trading partner on a regional basis.

3. Technology facilitation

US restrictions on China’s access to Nvidia chips and other advanced US technology have accelerated over the past three years. Now, it is uncertain whether Nvidia will be able to regain the Chinese market share it says has gone to zero.

“What the Chinese themselves are hoping for is not to be constrained by technology,” Johnson said. “Is the United States over? Or is this going to go on and on and on?”

Trump hinted on Wednesday that export restrictions on Nvidia’s fastest AI chips — Blackwell GPUs — Can be discussed When he meets something.

While Beijing still needs some more advanced US technology in the near term, its senior leaders stressed last week It plans to build out the local technology over the next five years.

4. Trade with other countries

China is also increasingly concerned as US trade and technology moves begin to impact its relations with other countries.

Beijing uses its dominance in rare earth materials as leverage to counter Washington’s restrictions on semiconductors. On October 9, China expanded its rare earth licensing system to include products – including advanced chips – in equal proportions Only 0.1% of rare earths come from China.

What prompted the reaction? Analysts point to a new US base on September 29 Expanded restrictions To include majority owned subsidiaries Chinese companies blacklisted – It may affect some people 20 thousand Chinese entities.

Wang of the Center for China and Globalization noted that the Dutch government was ordered to take charge Nexperia, a subsidiary of a Chinese company This is on the US entity list, it came On September 30th.

On Monday, the US trade agreement with Malaysia added provisions preventing Kuala Lumpur from doing so Working with “third countries” In ways that harm US products, while calling on Malaysia not to “undermine” US technological restrictions.

“Businesses are also concerned about that because that could lead to all kinds of different situations,” Johnson said, adding that Beijing wants to ensure that legitimate Chinese companies are not cut off abroad from global technology supply chains.

5. Mutual respect

Beijing has long called for trade talks with the United States to be held on the basis of “win-win cooperation” and “mutual respect.”

This mutual respect includes the US adhering to Beijing’s position on Taiwan and the South China Sea claims, said Li Dong Shaoping, a senior researcher at Renmin University of China. He also believes that the United States needs to see that China’s development is “reasonable.”

However, few people expect breakthroughs.

“I don’t think this week’s meeting will see results,” Dong said in Chinese, according to a CNBC translation.

From photo ops to framework agreements, both parties may leave with something on Thursday. Whether it will continue is another matter.

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Quote of the week

What we’re looking for is some agreement, and it will be something fairly substantive, but it won’t really impact those key issues, and it will probably only take us back to where we were on March 31, before Liberation Day in April.

— Angela Mancini, Partner at Control Risks

In the markets

Chinese markets rose on Wednesday ahead of the long-awaited meeting between Trump and Xi. The CSI 300 index rose about 1% after recording year-to-date gains of about 20%. The yuan in external transactions stabilized at 7.099 to the dollar.

Hong Kong markets are closed for holidays.

-Li Ying Shan