The U.S. and China have extended a truce to keep tariffs lower for longer and rare earths flowing, U.S. Treasury Secretary Scott Bessent said Wednesday local time.
He was speaking on Fox News, as Chinese President Xi Jinping landed in Washington, D.C. for a state visit through Friday.
Xi and Trump agreed to a one-year trade truce at a meeting in South Korea last October. The deal, which was set to expire in November, will now be extended to Jan. 10, Bessent said. He added that Beijing needs to fulfill more deliverables.
Ahead of this week’s summit, many had expected the truce would be extended by six months or longer.
The U.S. and China should discuss their differences on trade issues on the basis of mutual benefit, without actively imposing restrictions, said Dong Shaopeng, senior researcher at Renmin University of China. He expected the trade truce could be continually improved and extended.
Chinese state media did not immediately note Bessent’s comments on the trade truce.
The two-month extension “suggests to me the U.S. is unsatisfied with China’s offers and wants to keep the heat on, with a bonus being it is more likely that Xi goes to the G20 in Miami,” said Scott Kennedy of the U.S.-based think tank Center for Strategic and International Studies.
Trump visited Beijing in May. The two leaders could also meet alongside an APEC meeting in Shenzhen in November, and the G20 summit in Miami in December.
However, Jens Eskelund, president of the European Chamber of Commerce in China, pointed out that simply extending the trade truce does not address challenges companies face, including the lack of a standardized approach to apply for rare earths export licenses.
Xi said in an official readout for his arrival that he is confident the visit will produce “fruitful results” for both sides. He said the two countries should be partners, not rivals, and work to build a stable relationship where competition and differences are managed. The readout did not mention tariffs, rare earths or artificial intelligence.
Footage streamed on China’s state broadcaster showed U.S. President Donald Trump and First Lady Melania Trump meeting Xi and First Lady of China Peng Liyuan at the foot of the Chinese leader’s jet. The video did not show the U.S. and Chinese leaders shaking hands — it focused on Xi and his wife shaking hands with two children presenting them each with bouquets.
After greeting Xi, Trump told reporters he would discuss the Iran war with the Chinese leader, among “many other subjects.”
Bessent met with Chinese Vice Premier He Lifeng in New York ahead of Xi’s arrival in the U.S. The two sides discussed setting up an alert system for AI incidents, according to Bessent.
While executives of major U.S. tech companies plan to join a summit dinner on Thursday, none of their Chinese counterparts are expected to attend.
Politburo Standing Committee Member Cai Qi and China’s top diplomat Wang Yi accompanied Xi, according to state media.
—CNBC’s Eunice Yoon and Ashlee Trujillo contributed to this report.