US, China seek to avoid trade war escalation, salvage Trump-Xi meeting in Malaysia talks

Top economic officials from the U.S. and China kickstarted talks in Kuala Lumpur on Saturday to avert an escalation of their trade war and ensure that a meeting happens next week between U.S. President Donald Trump and Chinese President Xi Jinping.

The talks on the sidelines of the Association of Southeast Asian Nations summit will chart a path forward after Trump threatened new 100% tariffs on Chinese goods and other trade curbs starting on November 1, in retaliation for China's vastly expanded export controls on rare earth magnets and minerals.

The recent actions, which also include an expanded U.S. export blacklist that covers thousands more Chinese firms, have disrupted a delicate trade truce crafted by U.S. Treasury Secretary Scott Bessent, U.S. Trade Representative Jamieson Greer and Chinese Vice Premier He Lifeng over four previous meetings since May.

China's top trade negotiator Li Chenggang is also participating in the talks. A Reuters witness saw Li arriving alongside He at Kuala Lumpur's Merdeka 118 tower, the second-tallest building in the world, where the venue for the talks is located.

The Malaysian government and the U.S. and Chinese sides have provided few details about the meeting or any plans to brief the media about outcomes.

The three officials will try to pave the way for Trump and Xi to meet next Thursday at an Asia-Pacific Economic Cooperation summit in South Korea, a high-stakes conversation that could revolve around some interim relief on tariffs, technology controls and Chinese purchases of U.S. soybeans.

Minutes before the talks started, Trump said that he would like to discuss farmers when he sits down with Xi during his Asian trip and will bring up Taiwan, though he does not have plans to go there yet.

He also said he will likely raise the issue of releasing jailed Hong Kong media tycoon Jimmy Lai, whose case has become the most high-profile example of China's crackdown on rights and freedoms in the Asian financial hub.

"We have a lot to talk about with President Xi, and he has a lot to talk about with us. I think we'll have a good meeting," Trump said as he departed the White House.

Reuters