Highlights

• Presidents Xi and Trump held their third call of 2025, discussing economic stability, trade disputes, and sensitive issues like TikTok and semiconductor policy.
• High-level diplomatic talks continue between the two nations, with a potential in-person summit planned for fall APEC or ASEAN meetings.
• Despite ongoing tensions in technology and strategic domains, both countries appear committed to preventing a complete breakdown in bilateral relations.

Chinese President Xi Jinping and U.S. President Donald Trump held their third call of the year on September 19, according to Chinese media, signaling what Beijing-based analysts described as a “new stage” in the bilateral relationship. The two leaders reportedly discussed stabilizing relations, managing trade disputes, and navigating sensitive issues such as TikTok, military tensions, and semiconductor policy.

Given China’s monopoly position on rare earth element supply chains and for that matter some critical minerals, these unfolding discussions and trade talks remain of front and center importance.

According to a Chinese account (Sina (opens in a new tab)), Xi struck an optimistic tone, stressing that the world’s two largest economies “can achieve mutual success and prosperity” if they pursue “mutual respect, peaceful coexistence, and win–win cooperation.” Trump, for his part, was quoted as affirming the need to resolve the ongoing TikTok dispute and to support continued trade talks. Analysts cited by Chinese outlets emphasized that the dialogue marks not only progress in economic negotiations but also preparation for an in-person summit—possibly at the upcoming APEC meeting in South Korea or ASEAN summit in Malaysia this fall.

Behind the scenes, the past two weeks saw a flurry of high-level talks. Chinese Vice Premier He Lifeng met with U.S. Treasury Secretary Bessent and Trade Representative Greer in Madrid, focusing on trade frictions and the future of TikTok. Secretary of State Rubio and Chinese Foreign Minister Wang Yi also held direct talks, underscoring that“leader-to-leader diplomacy” remains the primary mechanism to steer the relationship. On defense, China’s minister spoke by video with U.S. Defense Secretary Hegseth, vowing to manage tensions responsibly.

TikTok remains the flashpoint with the greatest business relevance. Xi reiterated that Beijing supports “market-based” negotiations under Chinese law. At the same time, Trump signaled that Washington would allow more time—extending a ban deadline for the fourth time, now until December 16, 2025. ByteDance, TikTok’s parent, quickly issued a statement thanking both leaders and promising compliance. Chinese negotiators suggested a framework deal was already taking shape in Madrid, though U.S. media stress final terms remain uncertain.

The broader context is less smooth. Trump has reportedly floated the idea of reestablishing a U.S. presence at Afghanistan’s Bagram air base, a move Beijing sees as destabilizing. Meanwhile, Washington has added 32 firms—including 23 from China—to its export control list, while Beijing launched a counter-investigation targeting U.S. semiconductor restrictions. Both sides framed these actions as defensive, highlighting just how contested advanced technology and supply chains have become.

For investors and global businesses, the key takeaway is that both sides appear determined to avoid a free fall in relations. A potential Xi–Trump summit this fall could anchor that stability, at least temporarily. Yet the unresolved technology disputes, tariff risks, and strategic military maneuvers underscore that U.S.–China competition remains as sharp as ever—only now wrapped in the optics of cooperation.

Disclaimer: This article is translated and adapted from financial news published in the People’s Republic of China. The information has not been independently verified and should be cross-checked with non-state and international sources before drawing conclusions.

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