Trump and Xi Sit Down in Washington With Tariffs and AI on the Line

US President Donald Trump and Chinese President Xi Jinping are set to meet in Washington on Thursday, with a fragile trade truce between the world's two largest economies hanging in the balance [247081]. The summit, Xi's first state visit to the United States since 2015 and his second face-to-face meeting with Trump this year, will cover trade and artificial intelligence — two areas where the two countries are locked in fierce competition [247108][247081].

The two sides agreed to a trade truce earlier, pausing steep tariffs that had raised prices for businesses and consumers in both countries. That pause is now in question. If the two leaders fail to reach common ground, tariffs could return [247081].

Ahead of the summit, top officials from both countries met in New York on Sunday to discuss a plan for artificial intelligence safety [247050]. The talks produced progress on tariff exemptions and a new dialogue on AI, though Washington did not give details on which goods will be exempt or when the AI talks will start. Both sides described the discussions as constructive, and further meetings are expected [247100].

US Trade Representative Jamieson Greer is preparing the ground for the summit, and US Treasury Secretary Scott Bessent met Chinese Vice Premier He Lifeng ahead of the planned meeting [246594][246392]. Greer also blamed China on Monday for creating "uncertainty" over the extension of the 2025 Busan trade agreement, saying Beijing has not supplied enough strategic mineral exports to the United States. A dispute over rare earth minerals — a group of 17 elements used in smartphones, electric vehicles, and military equipment — is threatening to block the deal's extension [247142].

Xi's most urgent goal at the summit is extending the trade truce, according to source material. He is also expected to discuss Taiwan, Iran, and artificial intelligence with Trump [247069]. China's Ministry of Foreign Affairs confirmed on Monday that Xi will make a state visit to the United States from Wednesday to Friday, joined by senior aides with deep policy experience [247108].

AI has become a central point of tension. Both nations are racing to lead the technology, and each side sees the other as its main rival [247081]. Ro Khanna, the ranking member of the US House Select Committee on China, said in New York on Monday that the US and China should agree on international rules for AI, similar to the safety controls created during the atomic age [247154].

China's top state newspaper, the People's Daily, has set Beijing's terms for the summit, calling on both sides to build on the "constructive strategic stability" agreed during Trump's earlier visit to Beijing. Chinese officials and state media have also made Beijing's "red lines" clear in the days before the meeting. The two leaders are expected to give "strategic guidance" on how the world's two largest powers can maintain a stable relationship [247114].

Washington and Beijing are also discussing tariff relief on US liquefied natural gas (LNG) ahead of Xi's visit. China has already refilled its gas supply this year without American LNG, but a tariff deal could turn US LNG into a strategic option for China rather than a necessity [246533].

The call's outcome could shape the economic relationship between the world's two largest economies — and affect markets far beyond their borders [247081].