By Saqib S. Qureshi — SCN News
BEIJING/WASHINGTON, Sept. 21 — Chinese President Xi Jinping will arrive in Washington this week with China’s export machine still expanding despite years of U.S. tariff pressure, giving trade a powerful backdrop to his Sept. 24 summit with President Donald Trump as the world’s two largest economies try to preserve a fragile commercial truce. China’s global trade surplus is on course to exceed $1 trillion for a second consecutive year, while more than half of roughly 6,500 categories of Chinese products sold to the United States have recorded higher sales so far this year than in 2025, according to Reuters.
The figures complicate one of the central assumptions behind Washington’s increasingly aggressive trade policy toward Beijing: that tariffs and other economic pressure would force China into substantial concessions while reducing U.S. dependence on Chinese imports. Some parts of the strategy have had an impact, including restrictions targeting low-value parcels used heavily by online retailers such as Shein and Temu, but China has simultaneously expanded trade elsewhere and maintained a formidable presence in the U.S. market. The result is a summit in which neither side appears eager to revive the extreme tariff confrontation that shook markets last year.
Trump and Xi are scheduled to meet at the White House on Thursday, their second face-to-face meeting this year after talks in Beijing in May. The immediate economic question is whether they can maintain or extend the trade truce reached last October, which is currently due to expire on November 10. Treasury Secretary Scott Bessent said Monday that the deadline was discussed during preparatory talks with Chinese Vice Premier He Lifeng in New York, although the two sides did not agree there to an extension.
That makes the approaching summit less a negotiation over one new trade deal than an attempt to prevent the two countries from sliding back toward the confrontation that dominated much of 2025. Trump initially imposed additional tariffs on Chinese goods after returning to office, citing fentanyl and other concerns, and Beijing responded with duties on American products and restrictions involving critical minerals. By April 2025, headline tariffs had escalated dramatically on both sides before negotiations in Geneva began bringing them down.
A temporary agreement in May 2025 cut U.S. tariffs on Chinese goods to 30% from 145% and Chinese tariffs to 10% from 125%, before further negotiations culminated in the Trump-Xi truce in South Korea that October. Under that arrangement, Washington reduced some tariff pressure while Beijing agreed to steps involving fentanyl precursor chemicals, agricultural purchases and rare-earth export restrictions. The relationship shifted again after the U.S. Supreme Court struck down Trump's emergency tariff regime in February 2026, prompting the administration to use a different law for a temporary global duty.
The economic relationship has nevertheless proved difficult to unwind. Reuters reported Monday that more than half of the thousands of Chinese product categories entering the United States have increased from their 2025 levels this year, even as Washington continues trying to reshape supply chains. At the global level, China’s trade surplus is again heading beyond $1 trillion, illustrating how Chinese manufacturers have increasingly compensated for trade barriers in some markets by expanding sales elsewhere.
China still faces serious economic problems at home, including weak domestic demand and a prolonged property-sector downturn. Its strong exports therefore do not mean that the wider Chinese economy is free of vulnerabilities. They do, however, give Beijing an important source of growth and foreign demand at a time when Washington had hoped sustained trade pressure would substantially reduce China’s export advantage.
Those conditions have changed the immediate negotiating environment ahead of Xi’s visit. Reuters cited analysts who said Beijing appears more interested in extending stability than pursuing a dramatic new agreement, allowing China additional time to strengthen its economic resilience. The White House has also sought to lower expectations of a major breakthrough, making continuation of the existing truce and narrower agreements more plausible subjects for Thursday’s discussions.
Preparatory negotiations in New York show how much broader the agenda has become. Bessent and He discussed trade alongside rare-earth minerals and artificial intelligence, with the two governments agreeing to establish a formal AI dialogue and another meeting in Shenzhen in about two months. Bessent said the countries also plan to develop an “incident line” for communication over AI safety events, while discussions about the November trade-truce deadline remain unresolved.
Rare earths give Beijing another important source of leverage. China dominates significant parts of the processing and supply chain for minerals and magnets essential to automobiles, electronics, clean-energy systems and defence equipment, and restrictions imposed during previous rounds of the trade confrontation created concerns among American manufacturers. U.S. negotiators have therefore pressed China over the flow of rare-earth magnets and critical minerals as part of the talks leading into the summit.
Agriculture and aircraft purchases offer possible areas where Trump and Xi could announce more conventional commercial agreements. China made commitments during their May meeting to increase purchases of U.S. agricultural goods by $17 billion annually and buy more than 200 Boeing aircraft, according to Reuters reporting on the preparatory negotiations. Washington and Beijing have also recently discussed reducing or eliminating Chinese tariffs on American liquefied natural gas as part of a broader package of non-strategic trade measures.
A Chinese business delegation is expected to accompany Xi to Washington, potentially creating additional room for commercial announcements. Some of the participating companies are seeking greater access to the U.S. market despite regulatory scrutiny, Reuters reported. Any purchase commitments or market-access measures announced around the summit would need to be distinguished from a broader resolution of the structural disputes separating the two economies.
Trade, however, will not be the only sensitive issue on the table. Taiwan remains one of the most consequential disputes between Washington and Beijing, and Xi repeatedly raised the island with Trump when the two leaders met in Beijing in May. Trump has described a pending $14 billion U.S. arms package for Taiwan as a negotiating chip, while officials and analysts in Taiwan and Japan are watching closely for any change in Washington’s position during the summit.
Beijing considers democratically governed Taiwan part of China and has not renounced the use of force to bring the island under its control. Taiwan rejects Beijing’s sovereignty claims, while the United States maintains unofficial relations with Taipei and is required under U.S. law to provide Taiwan with means for self-defence. Whether Taiwan becomes connected to economic negotiations this week remains uncertain, and no agreement altering Washington’s Taiwan policy has been announced.
The summit also intersects with the war involving Iran. Washington sees Beijing as one of the governments with sufficient economic influence over Tehran to potentially affect Iranian calculations, but Reuters reported that Xi has shown little indication that he intends to exert the kind of pressure the Trump administration would prefer. China’s Foreign Ministry has separately said it was unaware of a sanctions-evasion scheme described in Reuters reporting through which Chinese goods were allegedly being sold to Iran.
For both governments, those multiple disputes increase the value of keeping the economic relationship relatively stable. Trump is dealing simultaneously with conflicts involving Iran and Ukraine and other foreign-policy pressures, while Xi has incentives to protect China’s export markets and strengthen domestic economic resilience. The shared interest in avoiding another abrupt trade rupture does not eliminate disagreements over tariffs, Taiwan, technology, rare earths or security, but it helps explain why officials on both sides are playing down expectations of a sweeping confrontation this week.
The most significant economic backdrop to Thursday’s meeting may therefore be what did not happen after the previous rounds of tariffs. U.S.-China commerce changed, some supply chains moved and trade barriers rose substantially, but China’s export sector did not collapse under American pressure. Instead, its global surplus is heading above $1 trillion again and thousands of Chinese product categories continue recording increased sales into the United States.
That does not establish that China has “won” the trade confrontation, nor does its export strength by itself measure the health of the Chinese economy. Beijing continues to face weak domestic demand and property-sector problems, while Washington retains considerable leverage through access to the U.S. market, advanced technology and financial networks. What the latest figures establish more narrowly is that tariffs have not produced the scale of export retrenchment that might have given Washington straightforward negotiating leverage over Beijing.
Thursday’s summit will consequently test whether Trump and Xi can convert that economic reality into another period of managed competition. The immediate benchmark will be the November 10 trade-truce deadline, alongside possible agreements involving agricultural purchases, LNG, rare earths and other non-sensitive trade. More difficult strategic questions — particularly Taiwan and technology restrictions — remain unresolved and could outlast whatever commercial understandings emerge in Washington.