Senior officials from the United States and China are meeting in London today in a fresh attempt to resolve their prolonged trade conflict, which has shaken global markets and dampened economic growth prospects.
Led by U.S. Commerce Secretary Howard Lutnick and Chinese Vice Premier He Lifeng, the talks are expected to focus on critical issues such as rare earth exports and restrictions on technology access. The meeting follows a phone call last week between U.S. President Donald Trump and Chinese President Xi Jinping, which Trump described as a “very good talk” that had yielded a “positive conclusion.”
This is the first formal engagement between the two economic superpowers since their temporary trade truce in May, which saw both sides reduce tariffs and agree to a 90-day window to negotiate a broader agreement. However, both countries have since accused each other of breaching that truce, particularly on non-tariff measures.
Washington has been vocal about China’s failure to lift restrictions on exports of rare earth magnets—materials vital to the production of electronics, electric vehicles, and military equipment. Meanwhile, Beijing has criticized the U.S. for maintaining curbs on advanced computer chips and related technologies, and for allegedly targeting Chinese tech companies and students.
The U.S. delegation also includes Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer. Their goal, officials say, is to reach a framework that could de-escalate tensions before the July 9 deadline set during the previous round of negotiations in Switzerland.
Commerce Secretary Lutnick’s inclusion in the talks is seen as particularly significant. Known for his role in crafting tough U.S. export controls, his presence could signal a willingness to compromise. Swetha Ramachandran, a fund manager at Artemis, noted that “with China producing nearly 70% of the world’s rare earths, there is enough leverage on both sides to reach a workable outcome.”
The talks come as China reported mixed trade figures. May exports rose by 4.8% year-on-year, but imports fell 3.4%, a sharper drop than analysts had predicted, underlining growing concerns over domestic demand.
Meanwhile, the OECD recently cut its global growth forecast to 2.9%, citing rising trade barriers. “Weakened economic prospects will be felt around the world, with almost no exception,” it warned.
Ahead of the U.S. talks, He Lifeng met with UK Chancellor Rachel Reeves to discuss economic cooperation. China is also seeking final approval to build a new embassy at Royal Mint Court, a move that has raised U.S. security concerns due to its proximity to London’s financial district.
As negotiations continue, both Washington and Beijing are under pressure to deliver a deal that will stabilize their relationship and ease the strain on the global economy.
