Economy

Can TikTok’s US Asset Transfer Deal Usher in a New Era of US-China Economic Cooperation?

China & US reach TikTok deal, triggering review. Trump/Xi to confirm; deadline may extend by 90 days.

byAndres Castro

September 17, 2025, 12:51 AM

A person's hand holds a mobile phone with the TikTok application logo on its screen. By MDL.

Executive Summary

China’s state media lauded a preliminary agreement for TikTok’s U.S. assets to transfer to American ownership as a “win-win,” signaling a potential de-escalation in economic tensions.

The deal involves China reviewing TikTok’s technology exports and intellectual property licensing, setting the stage for a critical call between President Donald Trump and Chinese President Xi Jinping.

The September 17 deadline for TikTok’s U.S. operations may be extended by 90 days to finalize the agreement, a move seen as a significant step toward stabilizing broader U.S.-China economic relations.

The Story So Far

The ongoing negotiations to transfer TikTok’s U.S. assets to American ownership are a direct response to escalating economic tensions and trade friction between the United States and China, which previously led to a similar deal being shelved after President Trump announced steep tariffs. With a critical deadline approaching that could disrupt the app’s operations, this agreement represents an effort to de-escalate these broader U.S.-China economic relations and address concerns surrounding the popular app.

Why This Matters

The preliminary agreement to transfer TikTok’s U.S. assets to American ownership signals a potential de-escalation in U.S.-China economic tensions, creating a pathway for broader dialogue on contentious issues like trade and technology beyond current tariff disputes. This development, coupled with China’s intent to review TikTok’s technology exports and intellectual property licensing, could set a precedent for future cross-border tech deals and intellectual property considerations between the two nations.

Who Thinks What?

China’s state media lauded the preliminary agreement to transfer TikTok’s U.S. assets as a “win-win” outcome, signaling a potential de-escalation in economic tensions and stating China would review related technology exports.

Investors on both sides of the Pacific view the framework deal as crucial for fostering further dialogue between the world’s two largest economies.

U.S. Treasury Secretary Scott Bessent suggested the September 17 deadline for TikTok’s operations could be extended by 90 days to allow for the finalization of the deal.

China’s state media on Wednesday lauded a preliminary agreement to transfer short-video app TikTok’s U.S. assets to American ownership as a “win-win” outcome, signaling a potential de-escalation in economic tensions with the United States. The move, which China also indicated would trigger a review of TikTok’s technology exports and intellectual property licensing, sets the stage for a critical call between President Donald Trump and Chinese President Xi Jinping on Friday to confirm the deal.

TikTok Deal Framework

The framework deal, reached in Madrid, aims to transition TikTok, which boasts 170 million U.S. users, to U.S.-controlled ownership from its Chinese parent company, Bytedance. This development is widely seen by investors on both sides of the Pacific as crucial for fostering further dialogue between the world’s two largest economies, extending beyond their current tariff truce.

According to a commentary in the official People’s Daily, China reached this consensus with the United States based on principles of “mutual respect, peaceful coexistence and win-win cooperation.” The commentary also stated that China would review matters related to TikTok’s technology exports and intellectual property licensing in accordance with its laws.

Negotiations and Deadlines

Sources familiar with the discussions, as reported by Reuters, indicate that the current agreement mirrors an earlier deal from this year. That prior arrangement was ultimately shelved following President Trump’s announcement of steep tariffs on Chinese goods, highlighting the volatile nature of recent U.S.-China economic relations.

Following meetings with Chinese negotiators in Madrid earlier this week, U.S. Treasury Secretary Scott Bessent addressed the September 17 deadline, which could have disrupted the app’s operations in the U.S. Bessent suggested this deadline could be extended by 90 days to allow for the finalization of the deal, though he provided no further specific details.

Implications for U.S.-China Relations

The progress made on the TikTok issue is viewed as a significant step toward stabilizing the broader economic relationship between Washington and Beijing. A successful resolution could pave the way for more comprehensive discussions on trade, technology, and intellectual property, areas that have been sources of friction.