• U.S. Trade Representative Jamieson Greer said export controls on advanced AI chips and semiconductor equipment are off the table in current U.S.-China negotiations.
  • The talks are focused on trade and economic issues, leaving national-security disputes unresolved.
  • A limited détente may yield tariff relief on non-strategic goods, but the technology rivalry remains intact.

A Narrow Path to Tariff Relief

The Trump administration’s trade negotiations with China are deliberately confined to economic issues, with U.S. export controls on advanced semiconductors and AI technology explicitly excluded, according to U.S. Trade Representative Jamieson Greer. In an interview with CNBC, Greer said conversations about export controls and national security are “off the table in these talks.”

The distinction means Washington is not offering to relax restrictions on cutting-edge chips or chipmaking equipment in exchange for tariff concessions. Instead, negotiators are working to “operationalize” a proposed Board of Trade process that would cover a narrow, balanced group of non-strategic products. Potential Chinese candidates include consumer and low-tech goods, while U.S. candidates include energy, farm products, and medical devices. No definitive product list or tariff-cut package has been announced.

“What we’re trying to do is create a process where we can address trade issues in a balanced way, without getting into the national-security issues that are not negotiable,” Greer said.

The immediate result is a limited détente: lower-risk goods and tariff relief may advance, while the central technology-security rivalry remains firmly in place. The truce, which had been due to expire on November 10, was recently extended through January 10, 2027, following talks between U.S. Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng in New York. The extension buys time for further economic negotiations but does not resolve core disputes.

Strategic Competition Persists

The policy split reflects the broader U.S.-China competition over military-relevant technology, artificial intelligence, and control of strategic supply chains. While the U.S. has proposed a separate AI-safety dialogue that could include notifications of AI-related incidents reaching a national-security threshold, Beijing’s response has been limited. The proposal remains preliminary, and experts caution that cooperation will be constrained by low trust and Beijing’s belief that U.S. policy aims to contain China’s technological development.

The separation of trade talks from export controls has significant implications for industries. U.S. restrictions on transfers of advanced chips and semiconductor-production technology remain in place, preserving compliance burdens and limiting Chinese access to certain cutting-edge capabilities. Consumer goods could see modest cost reductions or improved market access if selected low-tech products are included in a tariff-reduction mechanism, but this would not constitute broad normalization of trade.

Agriculture, energy, and medical exports could benefit if included in the non-sensitive-goods arrangement. However, earlier stated Chinese commitments—including an additional $17 billion in annual U.S. agricultural purchases and purchases of more than 200 Boeing (BA) aircraft—had not received an update after the talks. The lack of reported progress on critical minerals leaves a material supply-chain risk for industries such as autos, aerospace, defense, electronics, and clean energy. U.S. officials have said Chinese supplies remain inadequate despite earlier commitments.

Political Pressures and Domestic Constituencies

The political backdrop includes pressure from domestic constituencies. U.S. technology and security policymakers favor continued limits on sensitive technology transfers, while manufacturers, retailers, and importers favor tariff stability and supply certainty. Farmers and exporters want reliable Chinese demand. Auto-industry groups have urged the administration to retain strong barriers to Chinese vehicle sales on national-security grounds, even as officials discuss the possibility of Chinese automakers building U.S. factories.

The current separation between trade negotiations and export controls follows a rapid escalation-and-truce cycle that began in early 2025. After tariffs tied to fentanyl and immigration concerns were imposed, China retaliated with tariffs on U.S. energy products and autos, alongside restrictions on strategically important metals. By April 2025, both countries had raised tariffs sharply—at one point reaching 125% on each other’s goods—and China curtailed rare-earth exports. A Geneva pause in May 2025 cut tariffs substantially but did not resolve core disputes. In October 2025, China expanded rare-earth controls, and the U.S. responded with threatened additional tariffs and restrictions on critical software. Later that month, leaders reached a truce that paired tariff relief with Chinese commitments on fentanyl precursors, soybeans, and rare-earth controls. In May 2026, the countries announced planned Trade and Investment Boards, laying the groundwork for the current effort to identify a limited set of non-sensitive goods.

The precedent is therefore not a full settlement, but a pattern of narrowly scoped pauses that avert escalation while leaving technology, security, and strategic-material disputes unresolved. The most constructive near-term outcome would be a formally extended truce and a small initial tariff package for non-sensitive goods. That would benefit exporters and supply-chain planners while allowing both governments to claim progress without conceding on chips or security.

Key risks remain: critical-mineral access, agricultural commitments, aircraft purchases, Chinese industrial investment in the United States, and export controls are all potential flashpoints. None was comprehensively settled in the latest discussions. The most likely long-term trajectory is “managed coexistence,” not comprehensive normalization: selective commercial engagement alongside durable technology restrictions, supply-chain diversification, and periodic tariff bargaining. The unresolved divide over advanced chips and chipmaking tools indicates that the two countries’ strategic competition will continue even if trade conditions temporarily improve.

Investors and businesses should watch whether the January 10, 2027 deadline is extended again, whether the Board of Trade produces a concrete tariff list, whether China improves critical-mineral supply, whether agricultural and Boeing commitments are clarified, and whether the proposed AI-safety notification mechanism becomes a formal bilateral channel. Spokespersons for the U.S. Trade Representative and the Chinese Embassy in Washington did not immediately respond to requests for comment.

Correction: An earlier version of this article misstated the expiration date of the trade truce. It was due to expire on November 10, not November 1.