Following several hours of negotiations in New York, Scott Bessent said his meetings with China's Vice Premier He Lifeng and additional delegates were "very successful." A photo of Bessent and He from the meeting was posted on the Treasury Secretary's social account on Sept. 20. The two last sat down in person near Seoul about four months ago, just ahead of Trump's May trip to Beijing.
Both teams agreed to establish a formal channel for AI discussions, which Bessent said will be called the "US-China AI dialogue." He added, "The US has proposed that we have a notification mechanism between the two countries, and we want a shared vision of common goals and common threats," noting the alert system would be used for national security incidents.
China's top trade negotiator Li Chenggang said the talks were conducted in a good atmosphere and that a working group will continue discussions on Monday. Bessent also said the two sides plan to meet again. Later in the week, Trump will welcome Xi to the White House, marking the first state visit to Washington by the Chinese leader in more than a decade.
US Trade Representative Jamieson Greer said both governments are "preparing the groundwork" for a productive leaders' meeting and that they have "operationalized" a Board of Trade to "create a kind of ballast for the relationship." He said the tentative scope of the Board's "non-sensitive" list spans consumer and lower-tech goods sourced in China, while the US side would contribute categories such as energy, agriculture, and health-related items. Greer also said, "There is a world where you have a relatively small subset of American and Chinese goods that can be traded in a balanced way, that are non-sensitive, that in the future, as trade actions come up, we can consider them as a class unto themselves."
Bloomberg previously reported that Washington and Beijing are seeking to cut duties on American energy and farm goods, as part of a wider effort to lower barriers on roughly $30 billion in products on each side linked to the Board of Trade set up earlier this year.
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A tariff and export curbs truce reached in October, which led both sides to reduce tariffs and export restrictions, is due to expire in November. Neither government mentioned on Sunday whether it will be extended. A rollout of new US tariffs connected to claims about surplus manufacturing capacity among trading partners has been pushed back until after the leaders confer, said people with knowledge of the discussions.
Since Trump and Xi last met in May, AI has become a fresh friction point. Bessent said the notification channel would be used for national security events and argued that moving toward "more transparency between the number one and the number two AI powers in the world is very important." Greer noted that export controls were not on the AI agenda.
US officials, security agencies and major AI companies have accused Chinese firms of drawing from American models to build competing systems. Beijing dismissed the accusations as baseless and threatened to respond in kind should Washington seek to target Chinese AI firms. In addition, Chinese officials resisted appeals from US tech leaders to slow the tempo of AI development for safety, and the Foreign Ministry labeled those calls as "fear-mongering."
Bessent, who recently warned "there is no day after tomorrow" if China wins the AI race, told Axios last week that "we are open to discussions on avoiding shared risks and avoiding bifurcation of our two systems." White House science and technology adviser Michael Kratsios said on Fox News Sunday that "the key thing that we want to talk to them about is avoiding shared risks, and that's something that I think we can have a fruitful conversation on."
Two takeaways for your money: the new AI dialogue could lower the odds of nasty surprises in a sensitive area, and the Board of Trade workstream may shape access and pricing for specific consumer, energy, agricultural and medical goods. With Xi set to make his first state visit to Washington in over a decade later this week, any details on "non-sensitive" items or on the timing of tariffs could ripple through those parts of the market.
Keep an eye on Monday's working group session and any details that follow. The fine print on what counts as non-sensitive and where levies might ease will matter far more than the headlines.
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