Senior officials from America and China sat down for crucial discussions in Malaysia’s capital on Saturday, hoping to prevent their trade dispute from escalating and ensure that the two presidents can meet face-to-face next week.
American Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer met with China’s Vice Premier He Lifeng and trade negotiator Li Chenggang at the Merdeka 118 tower, the world’s second-highest building in Kuala Lumpur.
The discussions come at a tense moment. President Donald Trump has warned he might slap 100% tariffs on Chinese products starting November 1. This threat came after China put tough new limits on selling rare earth magnets and minerals to other countries. These materials are critical for many industries.
The dispute has damaged a careful agreement that Bessent, Greer, and He had worked out over four earlier meetings since May. Recently, Washington added thousands more Chinese companies to a list that blocks them from buying American products. Beijing responded by announcing worldwide restrictions on rare earth exports on October 10.
Neither the Malaysian hosts nor the American and Chinese teams shared much information about what they would discuss or whether they planned to tell reporters about any results.
Getting ready for the big meeting
The three officials are trying to clear the path for Trump and Xi Jinping to sit down next Thursday. That meeting is scheduled for an economic summit in South Korea, where leaders from countries around the Pacific Ocean will gather.
The conversation between the two presidents could touch on giving some temporary breaks on tariffs, easing technology restrictions, and getting China to buy American soybeans again.
Right before the Saturday talks began, Trump left Washington to start his trip through Asia. He told reporters what he wants to discuss with Xi.
Farmers dealing with China’s decision to stop buying U.S. soybeans will be one topic, Trump said. Taiwan, the self-ruled island that China says belongs to it, will also come up. Trump made clear he has no intention of visiting Taiwan himself.
Trying to avoid worse damage
The world’s two biggest economies want to prevent their tariff war from returning to extremely high levels on both sides.
When Bessent and Greer first met with Chinese counterparts in Geneva in May, they agreed to a 90-day pause in the fight. This brought tariffs down sharply to about 55% on the American side and 30% on the Chinese side. It also got rare-earth magnets moving again. They extended this agreement in later talks in London and Stockholm. It was set to end on November 10.
But things started falling apart at the end of September. America’s Commerce Department greatly expanded a list that automatically includes companies more than 50% owned by firms already on that list. This blocked American exports to thousands more Chinese businesses.
China hit back with new rare earth export controls on October 10, trying to stop these materials from being used in military equipment.
Bessent and Greer called China’s action a “global supply chain power grab” and promised America and its friends would not accept these limits. News reports say the Trump team is thinking about restricting even more exports to China, including items like laptops and jet engines.
Washington added more tension on Friday by starting a new investigation into whether China failed to keep promises made in a 2020 trade deal called the “Phase One” agreement. That deal had stopped their trade war during Trump’s first term as president.
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