[Blog] By Shaktee Ramtohul: Meeting between President Trump and President Xi Jinping: A New Dawn or Business as Usual?

Meetings between President Trump and various world leaders in 2025 have been quite unpredictable. While there are moments of camaraderie, these are often followed by the Trump administration imposing new tariffs on "so-called allied countries." India and Canada have faced significant diplomatic tensions with the United States. A notable incident occurred in April 2025, when President Trump showcased the tariff board at the White House, declaring it "Liberation Day" as reciprocal tariffs were enacted against nearly every nation, even one primarily populated by penguins (Heard and McDonald Islands near Antarctica!). This raises serious concerns about these policy choices.

Countries worldwide are racing against time to negotiate trade agreements with the United States. The exchanges between the United States and China have resulted in a series of retaliatory tariffs. Given that both nations are economic powerhouses, their diplomatic relations are closely monitored due to their potential effects on the global economy and financial markets. It is often said that when the United States and China sneeze, the entire world catches a cold!

Suspension of Export Controls

To alleviate trade tensions and other diplomatic issues, President Trump met with President Xi Jinping in Busan, South Korea, on October 30, 2025. Following their meeting, President Trump remarked on the significant agreements reached, while President Xi emphasized the importance of a long-term outlook and cooperation over a cycle of retaliation. Importantly, China is a significant exporter of rare earth minerals essential for smartphones, consumer electronics, and vehicles. In response to President Trump’s earlier tariffs, China had tightened its export controls on these minerals. However, after their recent talks, China announced a suspension of these export controls, allowing rare earth minerals to flow to the United States once more.

"China has emerged not as a junior partner, but as a formidable arbiter of global leverage and diplomatic recalibration."

President Trump encouraged China to purchase US chips from Nvidia, although it seems this will not include the latest Blackwell Chips, which have been a point of contention. The United States has imposed export controls on Nvidia's sales of advanced chips to China citing national security. While there has been no official announcement regarding the chip deal, President Xi mentioned that both countries would work together in the field of Artificial Intelligence.

Both leaders have reached a trade truce whereby the United States will reduce tariffs, and China will resume imports of soybeans from the US. During the trade conflict earlier this year, China had completely halted soybean purchases from the United States, negatively impacting US farmers. Furthermore, China has agreed to ramp up efforts to combat illegal fentanyl trafficking. Fentanyl, a highly addictive substance believed to be 50 times more potent than heroin, is at the heart of the opioid crisis in the United States, leading to thousands of overdose deaths annually. The US has often pointed to China as a source of precursor chemicals for fentanyl production.

Chinese Perspective

President Xi Jinping's statements convey that China does not aim to challenge or replace any other nation, focusing instead on excelling in its own endeavors. He asserted that China is well-equipped to manage various risks and challenges. President Trump, in his usual fashion, rated the meeting a perfect 12 out of ten, stating that more discussions between the two leaders are planned in the coming months. This meeting followed a South Asia tour by the Trump administration, which included visits to Malaysia, Japan, and South Korea, featuring an impromptu dance by President Trump in Malaysia and several tokens of friendship, such as a gold-leafed golf ball from Japan's new Prime Minister and a replica of a historic golden crown from South Korea's President.

The recent meetings, particularly between President Trump and President Xi Jinping, revealed different dynamics from China's viewpoint. China demonstrated that it would not be easily intimidated and could effectively handle risks and challenges. Notably, tariffs were paused without China having to make significant concessions beyond responding to the United States’ stance. While there have been fractures in the relationship, particularly regarding tariffs, the new agreement represents a moment of consensus rather than an act of concession. China has emerged not as a subordinate partner but as a powerful player in global diplomacy and leverage.

By Shaktee Ramtohul, Chartered Accountant & Business Consultant