By Dana Solomon, Senior Correspondent
High-level trade negotiations between the United States and China are set to resume in London on June 9, 2025, aiming to address ongoing economic tensions between the two nations. U.S. Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng will lead their respective delegations in discussions focused on tariffs, technology restrictions, and critical mineral exports.
A Fragile Truce Faces New Challenges
The upcoming talks follow a 90-day tariff truce established in May 2025 during negotiations in Geneva. Under the agreement, the U.S. reduced tariffs on Chinese imports from 145% to 30%, while China lowered its tariffs on American goods from 125% to 10%. This temporary de-escalation helped cool trade tensions, but disagreements quickly resurfaced.
China’s recent decision to suspend exports of certain rare earth minerals has disrupted global supply chains, particularly for industries that rely on these materials for high-tech manufacturing and defense applications. The move was seen by many as a strategic response to ongoing U.S. sanctions and export controls.
In turn, the United States imposed new restrictions on the export of advanced technologies to China, including jet engines and semiconductor components. Additionally, visas for several Chinese scholars and students pursuing technical degrees in the U.S. were revoked, leading to diplomatic protests from Beijing.
These developments have reignited concerns about a potential decoupling of the world’s two largest economies. Businesses and policymakers across the globe are watching the London summit closely for signs of progress or further deterioration.
Key Issues on the Negotiating Table
Several major issues will take center stage during the London talks:
- Export Controls: The U.S. delegation is expected to demand greater transparency and predictability regarding China’s export policies on rare earth minerals and other strategic resources.
- Technology Restrictions: China is seeking relief from U.S. export controls that limit access to critical technologies, arguing that such measures hinder innovation and global cooperation.
- Tariff Reductions: The temporary tariff rollback is up for review. Both sides are expected to debate whether to extend the truce, make it permanent, or revise the terms based on new economic data.
- Supply Chain Stability: Ensuring the uninterrupted flow of goods, particularly in sectors like electric vehicles and electronics, is a top priority for both nations.
- Intellectual Property Protections: Although not the headline issue, ongoing concerns about intellectual property theft and enforcement mechanisms will likely be raised during side sessions.
Global Implications of the Trade Dialogue
The outcome of the talks in London could have significant consequences beyond U.S.-China relations. Many other economies depend on the stability of global trade flows that involve these two powerhouses. Prolonged tensions or renewed tariff hikes could ripple through international markets, affecting prices, investments, and employment.
Industries particularly sensitive to trade disruptions include consumer electronics, automotive manufacturing, renewable energy, and pharmaceuticals. These sectors rely heavily on both Chinese raw materials and American innovations. A prolonged stalemate could force companies to reevaluate supply chains, increase inventories, or seek alternative suppliers, all of which could raise costs for consumers.
In recent months, business leaders from both countries have urged their governments to find common ground. Trade associations have emphasized the importance of predictability and open markets in fostering economic growth and innovation.
The Road Ahead: Diplomacy Meets Realpolitik
While the resumption of talks marks a positive development, few expect a comprehensive agreement to emerge from the London summit alone. The issues on the table are deeply entrenched, and the geopolitical stakes are high.
Both Scott Bessent and He Lifeng face domestic political pressures that could limit their flexibility. In the U.S., the upcoming presidential election looms large, while China is managing economic slowdown concerns and internal market reforms.
Nevertheless, even incremental progress—such as extending the current truce, agreeing on a framework for future discussions, or establishing working groups on specific topics—would be seen as a victory for diplomacy.
The next few days in London could set the tone for the next phase of U.S.-China economic relations. Whether that tone will be one of cooperation or continued confrontation remains to be seen.