Representatives from the world’s two largest economies are set to meet in London at a yet-to-be-disclosed location, aiming to revive a preliminary trade agreement struck in Geneva last month.
Leading the US delegation are Treasury Secretary Scott Bessent, Commerce Secretary Howard Lutnick, and US Trade Representative Jamieson Greer. China’s delegation will be headed by Vice Premier He Lifeng.
Tensions have escalated in recent weeks, with President Trump accusing China of breaching the terms of the Geneva deal—an allegation Beijing has strongly denied, in turn accusing Washington of failing to uphold its commitments.
China is widely seen as holding the upper hand in the ongoing trade negotiations with the United States, particularly over its dominance in the mining and processing of rare earth elements—a key topic in discussions taking place in London.
Rare earths are essential for a wide range of industries, including electric vehicles, robotics, and military hardware. In April, the Chinese government began requiring exporters to obtain licences for seven specific rare earth elements. The move triggered fears of supply shortages, with some car manufacturers warning that production lines could be at risk.
Although President Trump did not name rare earths directly, he issued a broad attack on China via social media late last month, accusing it of breaching a Geneva trade agreement.
Beijing responded over the weekend, with the Commerce Ministry stating that it has approved some export applications and will “continue to strengthen the approval of applications that comply with regulations.” The announcement appeared aimed at easing tensions, especially as concerns have also been raised by European companies.
Analysts say the rare earth issue highlights China’s strategic leverage in the trade dispute. “Despite the President’s previous rhetoric, there appears to be a chance that some of the aggression may be toned down,” said Richard Hunter, head of markets at Interactive Investor. “China holds a near-monopoly on rare earths, which are vital to high-tech manufacturing, giving it a significant edge.”
However, Hunter added that China might also be open to compromise, given signs that its economy is struggling under ongoing tariff pressures.
