Key Takeaways:
- Deadline Pressure: U.S. and Chinese negotiators met for over five hours in Stockholm to avoid an August 12 tariff snapback that could cripple global supply chains.
- American Leverage: Trump is demanding fairer trade and market access while China clings to its grip on rare earth minerals critical to U.S. industries.
- Next Moves: Another 90-day extension could pave the way for a Trump-Xi summit this fall, but bipartisan pressure in Washington over China’s human rights abuses adds fresh complications.
The world’s two largest economies squared off in Stockholm on Monday for more than five hours of high-stakes trade talks aimed at extending a fragile truce in their tariff war.
U.S. Treasury Chief Scott Bessent and China’s Vice Premier He Lifeng led the negotiations, seeking to avoid a looming August 12 deadline that could see punitive tariffs snap back to triple-digit levels. “I’d love to see China open up their country,” President Donald Trump told reporters during a press conference with U.K. Prime Minister Keir Starmer in Scotland.
An extension of the current 90-day tariff and export-control pause would stabilize global supply chains and pave the way for a potential Trump-Xi summit this fall. “What I expect is continued monitoring and checking in on the implementation of our agreement thus far… and setting the groundwork for enhanced trade and balanced trade going forward,” U.S. Trade Representative Jamieson Greer said on CNBC.
At stake? American access to rare earth minerals and magnets—critical to industries from defense to automotive—that Beijing has weaponized before. Meanwhile, the Trump administration is pressing China to finally rebalance its economy away from export dumping and state subsidies, a decades-long U.S. policy goal.
Adding to the pressure, bipartisan lawmakers in Washington are preparing legislation targeting China’s human rights abuses and its threats to Taiwan. Beijing’s hardline posture may be effective at buying time, but Trump is betting that a strong U.S. economy and his willingness to call China’s bluff will deliver results.