US, China economic leaders gather in Paris before Trump-Xi summit
Top economic officials from the US and China are preparing to initiate a new series of discussions in Paris on Sunday. The aim is to resolve issues in their trade agreement and facilitate a seamless visit for US President Donald Trump to Beijing, where he is scheduled to meet with Chinese President Xi Jinping at the end of March. The discussions, led by US Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng, are anticipated to center on the adjustment of US tariffs, the movement of Chinese-produced rare earth minerals and magnets to US buyers, American high-tech export controls, and Chinese acquisitions of US agricultural products. A source stated that the two sides will convene at the Paris headquarters of the Organisation for Economic Cooperation and Development. China is not part of the group of 38 predominantly affluent democracies and regards itself as a developing nation. United States Trade Representative Jamieson Greer will also participate in the discussions, which are part of a series of meetings held in European cities last year, aimed at alleviating tensions that nearly led to a collapse of trade between the world’s two largest economies. Analysts of US-China trade have indicated that, given the limited time for preparation and Washington’s focus on the US-Israeli conflict with Iran, the chances for a significant trade breakthrough are constrained, whether in Paris or at the Beijing summit. “Both sides, I think have a minimum goal of having a meeting, which sort of keeps things together and avoids a rupture and re-escalation of tensions,” said Scott Kennedy.
Trump may seek to depart from Beijing with significant Chinese commitments to purchase new Boeing aircraft and increase US acquisitions. Liquefied natural gas and soybeans are on the table, but to secure that, he might have to make some concessions regarding US export controls, Kennedy added. Instead, Kennedy stated that the likelihood of a summit is significant, one that “superficially suggests progress but that really just leaves things about where they’ve been for the last four months.” Trump and Xi may have the opportunity to meet three additional times this year, including at a China-hosted APEC summit in November and a US-hosted G20 summit in December, which could result in more concrete advancements. The US-Israeli conflict with Iran is expected to be a topic of discussion at the Paris talks, particularly concerning the rise in oil prices and the blockage of the Strait of Hormuz, a critical route for China, which relies on it for 45 percent of its oil supply. Bessent on Thursday night announced a 30-day waiver of sanctions to allow the sale of Russian oil stranded at sea in tankers, a move aimed at increasing supplies. On Saturday, Trump called on other nations to assist in safeguarding shipping in the Strait of Hormuz, following Washington’s bombing of military targets at Iran’s Kharg Island oil loading hub and Iran’s threats of retaliation.
In an editorial, China’s state-run China Daily emphasized the importance of maintaining continuity in the US-China dialogue, describing it as a “stabilizing anchor” in light of the uncertainty stemming from the “ongoing crisis in the Middle East.” The publication argued that this dialogue is essential for effectively addressing specific differences on issues such as strategic materials, technology, market access, and agriculture.”In a moment like this, the last thing the world needs is a trade war between its two largest economies,” China Daily said. Examination of the trade truce The two sides are anticipated to assess their advancements in fulfilling the commitments established under the October 2025 trade truce announced by Trump and Xi in Busan, South Korea. The agreement prevented a significant escalation in tensions, reduced US tariffs on Chinese imports, and temporarily halted China’s stringent export controls on rare earths for a year. The expansion of a US blacklist targeting Chinese companies prohibited from purchasing high-technology US goods, including semiconductor manufacturing equipment, has also been paused. China has committed to purchasing 12 million metric tons of US soybeans for the 2025 marketing year and 25 million tons for the 2026 season, which will commence with the fall harvest. US officials, including Bessent, have stated that China has thus far fulfilled its commitments under the Busan deal, referencing soybean purchases that achieved the initial targets.
However, while certain industries are obtaining rare earth exports from China, which holds a commanding position in global production, US aerospace and semiconductor companies are not receiving these materials and are confronting escalating shortages of essential components, such as yttrium, utilized in heat-resistant coatings for jet engines. “US priorities will likely be about agricultural purchases by China and greater access to Chinese rare earths in the short term” at the Paris talks, said William Chou, a senior fellow at the Hudson Institute, a Washington think tank. New trade investigations Greer and Bessent introduce a fresh complication to the Paris discussions, launching a new “Section 301” investigation into unfair trade practices aimed at China and 15 other significant trading partners. This inquiry addresses alleged excess industrial capacity, potentially paving the way for a new wave of tariffs in the coming months. Greer also initiated a similar investigation into purported forced labor practices across 60 countries, including China, which may lead to a ban on specific imports into the US. The probes seek to restore Trump’s tariff pressure on trading partners following the US Supreme Court’s ruling that deemed Trump’s global tariffs under an emergency law illegal. The ruling effectively lowered Trump’s tariffs on Chinese goods by 20 percentage points; however, he promptly enacted a 10 percent global tariff under a different trade law. On Friday, China condemned the investigations and asserted its right to implement countermeasures. The editorial from China Daily stated that the probes were “representative of unilateral actions that complicate negotiations.”
