US-China Trade Talks Enter Day Two Amid Tension Over Tech and Tariffs

Trade negotiations between the United States and China resumed in London for a second day, with both sides aiming to ease growing friction over technology exports and rare earth material supplies. The discussions, held at the historic Lancaster House, began Monday and extended over six hours. Talks were set to continue on Tuesday morning, with officials from both countries expressing measured optimism despite the complexity of the issues at hand.

President Donald Trump commented from the White House, stating, “China’s not easy,” but noted that he was receiving “only good reports” from his team. The US delegation was led by Treasury Secretary Scott Bessent, Commerce Secretary Howard Lutnick—formerly CEO of Cantor Fitzgerald—and Trade Representative Jamieson Greer. Lutnick’s involvement emphasized the rising stakes around US export controls, especially in the technology and defense sectors.

The Chinese delegation was led by Vice Premier He Lifeng, who left the negotiations without addressing the press. While US officials described the first day of talks as “fruitful,” no definitive agreements were announced. Key issues on the table include Washington’s restrictions on advanced tech exports and Beijing’s limits on rare earth shipments—critical materials used in smartphones, military equipment, and energy systems.

Reports suggest the US is weighing the removal of recent export restrictions on items like chip design software and jet engine parts, in exchange for China lifting rare earth constraints. However, Trump signaled caution, stressing that any easing of export rules would be conditional. “We’ll see,” he told reporters, while also accusing China of decades of economic exploitation against the US.

White House Economic Council chief Kevin Hassett hinted at possible concessions but confirmed that the most advanced semiconductor technology—such as Nvidia’s H2O AI chips—would remain restricted. While both sides appear ready to compromise on select items, the outcome of the talks remains uncertain, with markets watching closely as oil prices drop and trade tensions continue to ripple globally.

Source: Business day