US-China trade talks kick off in Stockholm
On Monday, Vice Premier He Lifeng and US Treasury Secretary Scott Bessent sat down in Stockholm for a new round of trade talks.
Some context: US-China trade relations have been on an (uneven) upswing since the two sides met in Geneva in May, agreeing to a 90-day trade truce.
- With the ceasefire scheduled to expire on August 12, Bessent previously hinted that the truce would be extended.
According to insider sources speaking to the SCMP, He and Bessent will add an additional 90 days to the clock, allowing for more time to negotiate.
- The sources also said that both sides would “expound their views on major sticking points – such as US concerns over China’s industrial overcapacity.”
The Chinese side is also reportedly set to raise the issue of fentanyl.
More context: The Trump administration imposed cumulative tariffs of 20% on China over its alleged role in the US fentanyl crisis.
- Since then, China has taken measures to crack down on the export of fentanyl precursors.
Get smart: A 90-day extension should keep trade tensions in check in the runup to a rumored Trump trip to China.
- In turn, a successful Trump visit could pave the way for more substantial breakthroughs in US-China ties.
Dare to hope: A reduction of fentanyl-related tariffs would indicate real momentum towards establishing productive and durable economic relations.