Top economic officials from the US and China are meeting today at the OECD headquarters in Paris to stabilize trade relations ahead of a planned summit between President Donald Trump and President Xi Jinping in Beijing at the end of March. Specifically, officials are reviewing the October 2025 Busan agreement, which temporarily lowered tariffs and paused export controls on rare earth minerals and semiconductor technology. The prime motive of the US is to seek increased Chinese purchases of agricultural products(soybeans), Boeing aircraft, and liquefied natural gas. Similarly, China aims for a reduction in US tariffs and a loosening of high-tech export controls. The key talks are led by US Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer, meeting with Chinese Vice Premier He Lifeng.
Geopolitical and conflict pressures
The ongoing US-Israeli conflict with Iran casts a major shadow over the talks. China is deeply concerned, as it relies on the Strait of Hormuz for 45% of its oil. Following US strikes on Iran’s Kharg Island, Secretary Bessent announced a 30-day sanctions waiver for Russian oil to help stabilize surging global energy prices. The briefing also noted a recent bombing of a fuel depot near Kandahar, further adding to the regional volatility.
Authorities open new trade investigations
A new Section 301 investigation into unfair trade practices targeting China and 15 other trading partners over alleged excess industrial capacity that could lead to a new round of tariffs within months. A similar probe into alleged forced labor practices into 60 countries, including China that could ban certain imports into the US. These probes seek to build Trump’s tariff pressure on trading partners after the US Supreme Court struck down his previous global tariffs, which were imposed under an emergency law, as illegal. This rule effectively reduced Trump’s tariffs on Chinese goods by 20 percentage points, though he immediately responded by imposing a 10% global tariff under a different trade law.
Trump-Xi summit: The 2026 Outlook
Consistent with analysts’ views, it is alarmingly cautious to suggest that with Washington’s focus diverted by the war in the Middle East, the Paris talks are largely seen as a holding action. This meeting aims to prevent a significant split in relations and set the diplomatic stage for the Trump-Xi meeting at the end of March.
