Economy

TikTok Deal, Tariff Talks: Can U.S.-China Negotiations Pave the Way for a Trump-Xi Meeting?

U.S. and China trade talks in Madrid address tariffs, TikTok, and chip disputes, impacting a potential Trump-Xi meeting.

byEditorial Staff

September 15, 2025, 10:44 AM

Two head silhouettes face each other across a large crack, with the US and Chinese flags inside them

An artistic depiction of the strained political and economic relationship between the United States and China. By Tomas Ragina / Shutterstock.com.

Executive Summary

U.S. and Chinese trade negotiators are holding a second day of talks in Madrid on tariffs, export controls, and TikTok’s future, with the outcome influencing a potential meeting between President Trump and Chinese President Xi Jinping.

A critical Wednesday deadline approaches for Beijing-headquartered ByteDance to finalize TikTok’s divestment in the U.S., a process complicated by China’s export controls on the platform’s technology.

Tensions have escalated due to China’s launch of two investigations into the U.S. semiconductor industry and a preliminary finding that Nvidia violated China’s anti-competition laws.

The Story So Far

The current trade talks between the U.S. and China are part of ongoing efforts to ease mutual restrictions and tariffs, building on previous agreements, but are significantly complicated by a looming deadline for the divestment of TikTok, which China’s export controls make difficult. Additionally, escalating tensions in the semiconductor industry, characterized by recent Chinese investigations into U.S. companies following American actions against Chinese firms, underscore the broader technological and economic competition between the two nations, all of which influences the potential for a future meeting between President Trump and Chinese President Xi Jinping.

Why This Matters

The ongoing U.S.-China trade talks are pivotal, as their outcome, particularly regarding the impending TikTok divestment deadline, will dictate the possibility of a high-level meeting between President Trump and President Xi Jinping, signaling the trajectory of future bilateral relations. Moreover, escalating tensions, evidenced by China’s new investigations into the U.S. semiconductor industry, underscore a deepening technological and economic rivalry that could further complicate global supply chains and international trade policies.

Who Thinks What?

U.S. negotiators, represented by Treasury Secretary Scott Bessent, are focused on resolving issues including tariff rates and export controls, indicating significant progress on the technical details regarding TikTok’s future.

Chinese negotiators are engaged in bilateral talks but have recently escalated tensions by launching investigations into the U.S. semiconductor industry, including anti-dumping and anti-discrimination probes, and found Nvidia in violation of anti-competition laws.

ByteDance, the Beijing-headquartered owner of TikTok, faces a critical Wednesday deadline to finalize a divestment deal for its U.S. operations, a process complicated by China’s placement of the technology on its export-control list, requiring Chinese approval for any sale.

U.S. and Chinese trade negotiators are engaged in a second day of talks in Madrid, Spain, addressing critical issues including tariff rates, export controls, and the impending Wednesday deadline for the divestment of the Chinese-owned social media platform TikTok. These discussions represent the fourth round of bilateral meetings in four months, following an agreement in May to ease some mutual restrictions and tariffs. The outcome of these talks is expected to influence the possibility of a meeting between President Donald Trump and Chinese President Xi Jinping later this year.

Key Negotiation Points

The initial day of negotiations reportedly focused on TikTok’s future, existing tariffs, and the broader economic landscape. U.S. Treasury Secretary Scott Bessent indicated that significant progress has been made on technical details, suggesting both sides are nearing an agreement regarding TikTok.

However, tensions have escalated recently due to China’s launch of two investigations targeting the U.S. semiconductor industry. These include an anti-dumping probe concerning certain American-made analog integrated circuit chips and an anti-discrimination investigation into U.S. actions against the Chinese chip sector. These probes were initiated after the U.S. added 23 more China-based companies to its entity list.

TikTok’s Future

Beijing-headquartered ByteDance faces a critical Wednesday deadline to finalize a deal for TikTok to continue its operations in the U.S. Any potential sale requires approval from China, which has placed the technology in question on its export-control list, complicating divestment efforts.

Semiconductor Industry Scrutiny

Adding to the complex trade environment, China’s market regulator announced Monday that a preliminary investigation found Nvidia in violation of the country’s anti-competition laws. This development underscores the broader economic and technological competition between the two nations.

Outlook for High-Level Dialogue

The prospects for a meeting between President Trump and President Xi Jinping later this year are largely contingent on the results of the ongoing Madrid talks. Specifically, a resolution regarding the fate of TikTok is considered a pivotal factor in paving the way for such a high-level engagement.