Economy

Trump and Xi Meet: Can This High-Stakes Summit Reset US-China Relations?

Trump and Xi met in S. Korea to de-escalate trade disputes. Talks focused on tariffs, tech, & fentanyl.

byEditorial Staff

October 29, 2025, 10:58 PM

A sharp portrait of Xi Jinping is shown next to a smartphone screen displaying a blurred Donald Trump.

A portrait of Xi Jinping next to a screen with Donald Trump. By Below the Sky / Shutterstock.com.

Executive Summary

President Donald Trump and Chinese President Xi Jinping held a highly anticipated meeting in Busan, South Korea, to address trade and tariff disputes, marking their first in-person engagement since Trump’s second term began.

The U.S. administration’s key objectives for the talks included restricting fentanyl flow and securing TikTok’s divestiture, along with broader discussions on tariffs, technology curbs, and rare earth minerals amidst escalating tensions.

Global financial markets are closely monitoring the high-stakes negotiations, showing optimism for a breakthrough, while President Xi’s visit also includes attending the APEC Economic Leaders’ Meeting in Gyeongju.

The Story So Far

The meeting between President Donald Trump and Chinese President Xi Jinping is taking place amidst escalating trade and tariff disputes between the two largest economies, which have recently manifested in export controls and threatened bans. The U.S. administration aims to address these broader trade issues, alongside specific objectives like restricting fentanyl flow and securing TikTok’s divestiture, as global markets closely monitor for a potential breakthrough to ease ongoing volatility.

Why This Matters

The highly anticipated meeting between President Trump and Chinese President Xi Jinping is crucial for de-escalating significant trade and tariff disputes that have fueled global market volatility. A breakthrough in these discussions could lead to increased stability in international trade and financial markets, potentially easing economic uncertainty. Conversely, a failure to address key issues such as technology curbs, export controls, or the flow of fentanyl could further heighten tensions between the two largest economies, sustaining market jitters and impacting global supply chains.

Who Thinks What?

The U.S. administration aims to restrict fentanyl flow, secure TikTok divestiture, and discuss tariffs, technology curbs, and rare earth minerals.

Beijing maintains a cautious outlook regarding the prospects of an immediate agreement, though it recently purchased significant U.S. soybean cargoes.

Global financial markets are optimistic about a potential trade agreement, showing a surge earlier in the week in hopes of a breakthrough in negotiations.

U.S. President Donald Trump and Chinese President Xi Jinping convened in Busan, South Korea, on Thursday for a highly anticipated meeting aimed at de-escalating trade and tariff disputes. The two leaders participated in a photo opportunity before their discussions, scheduled for 11 a.m. local time. This marks their first in-person engagement since President Trump began his second term in January.

High-Stakes Dialogue Amidst Rising Tensions

The meeting takes place against a backdrop of escalating tensions between the world’s two largest economies. Recent weeks have seen Beijing implement export controls and Washington threaten to ban certain software-powered exports to China, exacerbating an already strained relationship.

The U.S. administration has outlined several key objectives for the talks, including restricting the flow of fentanyl into the United States and securing the divestiture of TikTok from its Beijing-based parent company, ByteDance. Broader discussions are also expected to cover tariffs, technology curbs, and rare earth minerals.

While Beijing has maintained a more cautious outlook regarding the prospects of an immediate agreement, a potential sign of improving relations emerged recently. China reportedly purchased its first significant cargoes of U.S. soybeans in several months, as reported by Reuters on Wednesday.

Xi’s Broader South Korea Visit

President Xi’s presence in South Korea extends beyond the bilateral meeting with President Trump. He is undertaking his first state visit to the country in 11 years, from Thursday to Saturday, to attend the APEC Economic Leaders’ Meeting in Gyeongju.

Market Reaction and Outlook

Global financial markets have been closely monitoring developments from Busan, as the ongoing trade friction between the U.S. and China has consistently introduced volatility. Optimism regarding a potential trade agreement between the two nations led to a notable surge in global markets at the start of the week, reflecting investor hopes for a breakthrough in the high-stakes negotiations.