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World

Xi to Make First U.S. State Visit Since Obama Era; Trade Truce and AI on Agenda

Chinese President Xi Jinping is set to make his first U.S. state visit since the Obama administration, with talks expected to cover a trade truce extension, soybean and Boeing purchases, rare earth leverage and artificial intelligence.

AI News Feed · 2026-09-22 08:38

The newsletter, written from Beijing by Evelyn and with Singapore-based colleague Anniek Bao, said many people in China sounded far more optimistic about the bilateral relationship than those in the U.S. ahead of the summit. It said this reflected Beijing's growing confidence after China became the first major economy to retaliate against the Trump administration's 'Liberation Day' tariffs in April 2025, while Washington's concerns have grown, including staying ahead of China in the AI race.

The two sides are expected to extend the trade truce expiring in November, though how long remains unclear. At a meeting last fall in South Korea, U.S. President Donald Trump and Xi agreed to suspend rare earth export controls and retaliatory tariff measures for a year. At a May meeting, Beijing agreed to increase purchases of U.S. agricultural products and Boeing jets, while both sides planned new trade and investment-related cooperation mechanisms and decided to pursue 'constructive strategic stability.'

Zhou Bo, a retired senior colonel, China Forum expert and senior fellow at Tsinghua University's Center for International Security and Strategy, said the May summit started 'a U-turn in China-U.S. relations' and was a rare recognition of Beijing as a peer power. 'Stability can only be found between countries of similar strength,' he said, according to the newsletter.

China has increased purchases of American soybeans in recent weeks, completing nearly half of the committed annual sum of 25 million tons this year, according to Reuters, as cited by CNBC. Boeing CEO Kelly Ortberg last week, at an event with Morgan Stanley, played down expectations that Beijing would follow through on a 200-jetliner order in a single blockbuster deal, expecting incremental orders by individual carriers instead.

Chad Brown, senior fellow at the U.S.-based Peterson Institute for International Economics, told reporters on Monday that the best the U.S. can hope for is probably maintaining the status quo. 'That's really because of the leverage China holds at the moment over rare earths, permanent magnets,' he said. 'Until that problem is solved, China is really going to continue to have that kind of leverage and push back on any major demands that a U.S. administration might have.'

Beijing on Monday confirmed Xi would visit the U.S. from Wednesday to Friday. The trip is expected to mirror Trump's one-and-a-half-day visit to Beijing in May.

On technology, Chinese AI labs have narrowed the gap with U.S. rivals this year, while American companies have raised alarms about the risks of developing the technology faster than it can be controlled. It remains unclear what cooperation on AI would look like. Zhou said general dialogue similar to prior AI talks in Geneva was possible.

Over the weekend in New York, senior negotiators from both countries discussed setting up a 'U.S.-China AI Dialogue,' U.S. Treasury Secretary Scott Bessent said. He noted the U.S. proposed a notification system for AI incidents. Chinese Vice Premier He Lifeng is in the U.S. for talks through Wednesday in preparation for the summit.

U.S. worries about AI have accelerated since early last week and AI will be part of the discussions between Trump and Xi, according to a person familiar with thinking in Washington in recent days. The source requested anonymity because of the sensitivity of the trade talks. A key aspect will likely cover how to get China not to empower nefarious actors with its AI, the source said, adding that efforts to get China to buy Nvidia H200 chips were not a significant part of discussions.

Amazon's Jeff Bezos, Elon Musk, Google's Sundar Pichai, Michael Dell, Nvidia's Jensen Huang, OpenAI's Sam Altman, Citigroup's Jane Fraser and Apple's Tim Cook are set to attend Trump's state dinner for Xi, according to senior U.S. officials. But as of Friday, the source said the U.S. had not received any visa applications for Chinese business attendees. There has also been little detail on the 'Board of Investment' despite its formal proposal in May.

Orville Schell, Arthur Ross Director of the Center on U.S.-China Relations and vice president at the Asia Society, said Chinese and U.S. businesses both need assurances that the geopolitical environment will remain stable enough for them to see returns on investments in each other's countries. He said that was a tough ask.