China and US to Resume Trade Talks Amid Escalating Tensions

China and the United States have agreed to restart trade negotiations next week in a bid to ease mounting economic tensions and avoid a renewed tariff war between the world’s two largest economies.

The decision follows a tense week, during which Beijing announced sweeping restrictions on rare earth exports, prompting US President Donald Trump to threaten 100% tariffs on Chinese imports. Trump had also hinted at cancelling a planned meeting with Chinese President Xi Jinping at the upcoming Asia-Pacific Economic Cooperation (APEC) summit in South Korea.

However, hopes of de-escalation rose after Chinese Vice Premier He Lifeng and US Treasury Secretary Scott Bessent held what was described as a “candid and constructive” video call on Saturday. Both sides agreed to meet in person next week to continue discussions, according to reports from Chinese state media and Bessent’s own social media statement.

US Trade Representative Jamieson Greer also joined the conversation, which reportedly focused on rare earth restrictions a key issue, as these materials are essential for everything from smartphones to military technology.

Meanwhile, the US is working with G7 finance ministers to coordinate a response to China’s export controls. EU Economy Commissioner Valdis Dombrovskis confirmed that member nations would share intelligence and seek alternative suppliers, though he warned that diversifying rare earth sources could take years.

German Finance Minister Lars Klingbeil voiced hope that a face-to-face meeting between Trump and Xi during the APEC summit could help ease tensions, noting G7 countries have taken a unified stance against China’s recent actions.

IMF Managing Director Kristalina Georgieva also expressed optimism that both countries could reach a new understanding to prevent further economic fallout.

The US-China trade dispute flared up again earlier this year after Trump’s return to office, with both sides imposing and later reducing high tariffs. While tensions have eased slightly, the underlying issues remain unresolved making the upcoming negotiations critical for the future of global trade stability.