Washington (AP) – Top We and Chinese officials meet in Stockholmthey are almost certain to agree to at least leave. Customs At the current level to last longer for the meeting between the presidents later this year Trade Contract According to analysts, between the two largest economies in the world.
Treasury Secretary Scott Bescent and China’s Deputy Prime Minister Lifeeng are set to hold their third consultation this year. This round, in the Swedish capital, four months after President Donald Trump disrupts world trade with his sweeping tariff proposal, including import taxes, which rose up by up to 145% on Chinese goods.
“We have the scope of our deal with China,” Trump said before departing for Scotland on Friday.
Becent told MSNBC on Wednesday that both countries had reached a “current status” following talks in Geneva and London, with the US taxing 30% on Chinese imports, and that China responded with a 10% tariff on tariffs prior to the start of Trump’s second term.
“Now we can discuss other issues in terms of keeping economic relations in balance,” Bescent said. He mentioned last year that the US had a trade deficit of $295.5 billion. The US is seeking an agreement that could export more to China and move the Chinese economy further into domestic consumer spending.
The Chinese Embassy in Washington said it hopes that Beijing will “have more consensus, cooperation and less misunderstanding.”
Focusing on the potential for leadership summits, Stockholm was able to provide some answers on the timeline and feasibility of that particular goal ahead of the meeting between Trump and Chinese leader Xi Jinping.
“The conference will be important in setting the stage for Trump and XI’s fall meeting,” said Wendy Cutler, former US trade negotiator and now vice president of the Asian Association’s Institute of Policy Studies. “Beijing may insist on detailed preparations before agreeing to a leader’s meeting.”
In Stockholm, both sides may focus on commercial announcements that will be made at leadership summits. It also announces that XI and Trump should meet with a deal to address “major stimulants,” including the overcapacity of China’s industry and the lack of control over the chemicals used to make fentanyl.
Sean Stein, chairman of the US-China Business Council, said Stockholm could be the first real opportunity for two governments to tackle structural reform issues, including market access in China for US companies.
The companies that want to come out of Stockholm are primarily “atmosphere” and how both parties characterise the argument. They will also be looking for clues for leaders’ summits.
Fentanyl-related tariffs are probably the focus for China
In Stockholm, Beijing could require the removal of the 20% fentanyl-related tariffs Trump imposed earlier this year, said San Yun, director of the China program at the Washington-based Stimson Center.
This round of US-China trade disputes began with fentanyl in February when Trump imposed a 10% tariff on Chinese goods. The following month, Trump added another 10% tax for the same reason. Beijing retaliated with additional duties on certain US goods, including agricultural products such as coal, liquefied natural gas, beef, chicken, pork and soybeans.
In Geneva, both sides climbed from the triple-digit tariffs that were rolled out following Trump’s “liberation day” tariffs in April, but the US maintained a 20% “fentanyl” tariff, in addition to a 10% baseline rate. These full obligations were not changed a month later when the two sides met in London and negotiated non-tariff measures, such as export restrictions on important products.
The Chinese government has long protested that American politicians have blamed China on the US fentanyl crisis, but has argued that the underlying problem lies in the US itself. Washington says Beijing hasn’t done enough to regulate precursor chemicals that flow from China into drug dealers’ hands.
In July, China placed two fentanyl components under enhanced control. This is a movement seen in response to US pressure and goodwill in signaling.
Gabriel Wildow, managing director of consulting firm Teno, said that while he doesn’t think tariffs will disappear in Stockholm, the tariff relief could become part of the final trade agreement.
“While Trump could cancel the 20% tariffs that he explicitly links with fentanyl, we expect China’s final tariff levels to be as high as the 15-20% percentage included in Vietnam’s recent deal with Indonesia,” Wildow said.
We hope to reduce abandonment in China and reduce oil buying from Russia and Iran.
China’s industrial overcapacity is a headache for the US, just like the European Union. Even Beijing acknowledged the issue, suggesting that it could be difficult to deal with.
The US trade imbalance with China has fallen from its $418 billion peak in 2018, according to the Census Bureau. However, China discovered a new market for its products, and it was slightly larger than the US-wide trade deficit in 2024 as the world’s dominant manufacturers operated a global trade surplus that approached $1 trillion last year. It also has the advent of China’s electric vehicles and other emerging technologies, and is based on the same industry as the US and the same industry as the European-based industry.
“Some companies, especially manufacturers, feel that China’s manufacturing capabilities are too strong and that the Chinese are too hardworking. The factories run 24 hours a day,” Chinese Prime Minister Li Qiang said when he hosted the European Commission’s Ursula von der Leien in Beijing. “Some people think this will create some new problems in the balance between supply and demand in global production.”
“We’re seeing this issue too,” Li said.
Bescent also said Stockholm’s story could address Chinese purchases of Russian and Iranian oil. However, Teneo’s Wildau said China could exchange for US security concessions, including a decline in the presence of US troops in East Asia and scaled diplomatic support for Taiwan and the Philippines. This will likely face a political pushback in Washington.
The Stockholm consultations are “directed towards building a trade agreement based on China’s purchase commitment and investment pledge in the US in exchange for partial relief from US tariffs and export controls,” Wildow said.
He suspects there is an epic deal. Instead, he predicts that it is “a more limited agreement based on fentanyl.”
“That’s probably a positive outcome for China’s Hawk in the Trump administration, and I’m worried that an acre Trump might be offered too much in Xi Chiang.”
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Associated Press Writer Paul Wiseman contributed to this report
