US, China extend trade truce by two months as Xi Jinping arrives for high-stakes summit with Trump

US Treasury Secretary Scott Bessent said on Wednesday that Washington and Beijing have agreed to extend their trade truce by two months, pushing the expiration date from November 10 to January 10. The agreement followed marathon negotiations between Bessent and Chinese Vice Premier He Lifeng, with talks taking place in New York on Sunday and Washington on Wednesday. The announcement came as Chinese President Xi Jinping arrived in the United States ahead of a high-stakes meeting with President Donald Trump scheduled for Thursday.

"We have agreed today that we will extend what we call the Busan Agreement, the economic detente between the two countries that was scheduled to end on November 10th," Bessent told Fox News in an interview. "That is going to be extended until January 10th to give us more time to see what we can do on the economic front," he added. The trade truce, which took effect last year following an agreement between Trump and Xi, included measures aimed at reducing escalating tariffs imposed by both countries. Under the arrangement, Washington and Beijing agreed to lower tit-for-tat tariffs, while the United States also extended certain tariff exclusions.

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The US had additionally agreed to suspend responsive measures stemming from an investigation into China's shipbuilding industry. Bessent said that there could also be scope for both countries to reduce tariffs on roughly $30 billion worth of non-sensitive goods. The possibility remains under discussion. Following several hours of negotiations on Sunday involving Bessent, US Trade Representative Jamieson Greer and their Chinese counterparts, Greer said the two sides were continuing to work through the issue.

The negotiations have also extended beyond trade. Washington and Beijing discussed establishing a notification system that would allow both governments to flag incidents or potential threats involving artificial intelligence. The latest agreement comes as the Trump-Xi summit is expected to address broader economic and technology-related issues in US-China relations.