• Presidents Trump and Xi Jinping will hold their first face-to-face meeting since Trump's return to the White House at next month's APEC summit in South Korea.
  • The meeting follows recent progress on several contentious issues, including an agreement allowing TikTok to continue U.S. operations.
  • Markets are watching for signals on potential de-escalation of trade tensions, though major breakthroughs on tariffs are seen as unlikely until 2026.

High-Stakes Diplomacy

President Donald Trump will meet Chinese President Xi Jinping at the Asia-Pacific Economic Cooperation summit in South Korea from October 31 to November 1, marking their first in-person encounter since Trump began his second term. The announcement comes after what both sides described as a productive phone call earlier this week where they discussed the ongoing trade war, technology restrictions, and the Russia-Ukraine conflict.

According to people familiar with the planning, the leaders made significant headway during their recent call, reaching an understanding that will allow TikTok to continue operating in the United States, avoiding a potential ban that had threatened the platform's future. The agreement represents a notable compromise from Trump's previous hardline stance on the Chinese-owned social media app.

Economic Implications

The meeting comes amid persistent tensions over U.S. tariffs on Chinese goods, including the current 55% rate on certain imports and Trump's broader calls for a universal 10% tariff on all imports. Market participants are cautiously optimistic that the face-to-face dialogue could stabilize relations, though substantive agreements on core trade issues are not expected until Trump's planned visit to China in early 2026.

"What we're seeing is the beginning of a thaw, but the real work on tariffs and technology restrictions will likely wait until next year," said one trade policy expert who requested anonymity to discuss sensitive diplomatic matters. "Both sides want to save their headline agreements for when they can maximize political impact."

Chinese officials have been notably more cautious in their public statements, emphasizing the need to avoid "unilateral trade restrictions" and calling for balanced engagement. This reflects Beijing's ongoing concerns about escalating U.S. tariffs and technology curbs that have complicated China's economic recovery efforts.

Looking Ahead

White House officials confirmed that Trump intends to travel to China in early 2026, with Xi expected to reciprocate with a U.S. visit later that year. The back-to-back summits suggest both leaders are positioning for extended negotiations rather than expecting immediate resolution of long-standing disputes.

Previous high-level talks, including recent secretary of state meetings in Malaysia, were described by participants as "productive" but yielded no major breakthroughs. The upcoming APEC meeting is widely seen as setting the tone for U.S.-China relations through the remainder of 2025 and into the critical negotiation period of 2026.

Business groups and investors are monitoring developments closely, as any positive signals could ease short-term market anxieties about further escalation in the trade war. However, the fundamental disagreements over technology transfers, supply chain security, and market access remain substantial hurdles to any comprehensive agreement.

Correction: An earlier version of this article misstated the timing of President Trump's planned visit to China. The visit is scheduled for early 2026, not late 2025.