US and China Resume Trade Talks in Kuala Lumpur Amid Looming 155% Tariff Threat

Top economic officials from the United States and China convened in Kuala Lumpur on Saturday for crucial negotiations aimed at averting a fresh escalation in their long-running trade conflict. The talks, held on the sidelines of the Association of Southeast Asian Nations (ASEAN) summit, come as US President Donald Trump threatens to impose sweeping 155% tariffs on Chinese imports starting November 1.

High-Level Delegations Seek to Prevent Trade Breakdown

The discussions involve US Treasury Secretary Scott Bessent, Trade Representative Jamieson Greer, and China’s Vice Premier He Lifeng, alongside top trade negotiator Li Chenggang. The officials are attempting to rebuild a fragile truce that has been tested by recent tit-for-tat measures, including China’s expanded export controls on rare earth minerals and Washington’s enlargement of its export blacklist to cover thousands of Chinese firms.

Trump and Xi Meeting Expected at Upcoming Summit

The Kuala Lumpur talks are designed to prepare for a potential meeting between President Trump and President Xi Jinping next week at the Asia-Pacific Economic Cooperation (APEC) summit in South Korea. While both sides remain tight-lipped about the details, sources suggest the agenda will include tariffs, technology restrictions, and agricultural trade. Trump indicated that he intends to raise the issues of Taiwan and the imprisonment of Hong Kong media tycoon Jimmy Lai during his Asian tour.

Rare Earth Controls and Technology Restrictions at the Core

Analysts note that resolving disputes over rare earth export controls and US technology restrictions will be critical. China’s new licensing regime for rare earth exports—essential to high-tech and defence manufacturing—has been described as a strategic tool in the trade standoff. Experts from the Atlantic Council and the Centre for Strategic and International Studies warned that any failure to reach compromise could revive triple-digit tariffs and further destabilise global supply chains.

Exam Oriented Facts

• The US currently maintains tariffs averaging 55% on Chinese imports under the temporary truce.
• China’s rare earth export controls require licensing for materials used in global technology and defence industries.
• The upcoming APEC summit in South Korea may host the first Trump–Xi meeting since mid-2024.
• Rare earth minerals are vital for manufacturing electronics, electric vehicles, and missile systems.

Trade Truce Nearing Expiry Amid Legal and Economic Uncertainty

The existing trade truce, established in May and extended in London and Stockholm, is due to expire on November 10. Its stability has been undermined by the US decision to broaden its export blacklist and China’s retaliatory restrictions. Washington’s newly launched probe into Beijing’s alleged non-compliance with the 2020 trade agreement may provide grounds for Trump’s administration to intensify tariffs. With China ceasing US soybean purchases since September, the economic stakes—and political pressures—remain high as both nations attempt to defuse the latest trade confrontation.