US and China extend Busan trade truce to January 10 as Xi visits Washington

Extension of the Busan pact

The United States and China agreed on Wednesday to extend their bilateral trade truce by two months, moving the expiration date from November 10 to January 10. Treasury Secretary Scott Bessent announced the extension during an interview on Fox News following meetings with Chinese Vice Premier He Lifeng. The initial framework, known as the Busan agreement, was concluded in South Korea in October 2025 to halt an escalating cycle of tit-for-tat tariffs between the two economies. Under that arrangement, Washington suspended proposed tariffs on Chinese goods, while Beijing paused export restrictions on rare earth elements and critical minerals used across American manufacturing.

We met today to see if we could do a bigger deal as opposed to just a series of smaller things. We have agreed today that we will extend what we call the Busan Agreement.

Negotiations on tariffs and agriculture

Bessent and He met on Sunday and again on Wednesday to explore broader terms, including reciprocal tariff reductions covering $30 billion of imports from each country. The negotiations also focus on whether Beijing is fulfilling purchase targets established during previous bilateral sessions. In May, China agreed to buy at least $17 billion in American non-soybean agricultural products annually through 2028, but it is currently not on track to meet its prorated target for 2026. Beijing also pledged to buy 12 million metric tons of American soybeans in late 2025 followed by 25 million tons each year through 2028, after missing its 2025 commitment.

Beijing wanted a much longer period of predictability, while Washington has preserved an early opportunity to test Chinese performance and reassess its leverage.

AI security and broader summit agenda

Beyond physical goods, the bilateral negotiations cover financial services and artificial intelligence. Washington and Beijing are preparing a formal dialogue on artificial intelligence security, which includes communication mechanisms to address emerging technological incidents. Bessent said China appears very eager to engage on artificial intelligence governance following a national security notification system he announced last weekend. The two sides are working to define key risks, including uncontrolled artificial intelligence agents and non-state actors using artificial intelligence to conduct cyberattacks. Economic negotiators indicated that additional announcements concerning financial services may accompany the leaders' talks.

State visit proceedings

The extension announcement coincided with the arrival of Chinese President Xi Jinping at Joint Base Andrews outside Washington on Wednesday for a three-day state visit, marking his first trip to the capital in eleven years. President Donald Trump greeted Xi and his wife, Peng Liyuan, directly on the airport tarmac. The itinerary features a formal White House welcome with an honor guard, a bilateral meeting between the two leaders on Thursday, a state dinner, and a visit to the National Archives. Bessent noted that this summit could be the second of as many as four in-person meetings between Trump and Xi this year, while European reports identified it as their third direct encounter since Trump took office.