On a bustling Sunday afternoon in Madrid, the world’s two largest economies once again found themselves face to face, wrestling with the same stubborn trade disputes that have dogged their relationship for years. U.S. and Chinese officials converged at the Spanish foreign ministry on September 14, 2025, for what marked the fourth round of high-stakes talks in just four months. The mood outside the Palacio de Santa Cruz was lively, with journalists from Chinese, European, and Spanish outlets jostling for position and curious locals peering in from nearby cafes, hoping to catch a glimpse of history in the making.
The delegations, led on the U.S. side by Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer, and on the Chinese side by Vice-Premier He Lifeng and top trade negotiator Li Chenggang, arrived in Madrid just hours after the Chinese team’s plane touched down. The Spanish capital, with its ornate government buildings and sunlit plazas, had been chosen for a reason: Spain’s government, under Prime Minister Pedro Sánchez, was eager to showcase its role as a diplomatic broker and reinforce its own standing on the world stage. As a Spanish government source told Reuters, the choice of Madrid was “evidence that Madrid was consolidating itself as a seat of high-level and strategic negotiations.”
Yet, for all the pomp and circumstance, expectations for a major breakthrough were low. According to Reuters and the South China Morning Post, trade experts widely agreed that the most likely outcome would be another extension of the U.S. divestiture deadline for TikTok, the wildly popular Chinese short video app owned by ByteDance. The issue, which had not been formally discussed in previous rounds in Geneva, London, or Stockholm, was placed front and center this time—perhaps, as one source close to the Trump administration suggested, to provide “political cover for another extension,” even if it risked annoying both Republicans and Democrats in Congress who have pushed for TikTok’s sale to a U.S. entity over national security concerns.
The stakes for TikTok are high. Since President Donald Trump renewed his tariff war in April, the app has become a lightning rod in the broader U.S.-China rivalry. Ironically, Trump himself launched a TikTok account in August, even as his administration pressed for its divestiture. The deadline for TikTok’s sale has already been extended three times since Trump took office in January 2025, and few believed that Sunday’s talks would yield a final resolution. Instead, as former U.S. Trade Representative negotiator Wendy Cutler told Reuters, “I expect more substantial deliverables to be saved for a potential meeting between Mr. Trump and Chinese President Xi Jinping later in 2025, perhaps at an Asia Pacific Economic Cooperation summit in Seoul at the end of October.”
But TikTok was far from the only item on the agenda. The U.S. delegation pressed its G7 and European allies to impose “meaningful tariffs” on imports from China and India, in a bid to pressure both countries to halt their purchases of Russian oil. The logic? By cutting off the revenues that fund President Vladimir Putin’s war machine, the West hopes to force Moscow to the negotiating table and bring about peace in Ukraine. As Bessent and Greer said in a joint statement, “Only with a unified effort that cuts off the revenues funding Putin’s war machine at the source will we be able to apply sufficient economic pressure to end the senseless killing.”
The G7 finance ministers had already discussed these measures on September 12, agreeing to speed up discussions on using frozen Russian assets to aid Ukraine’s defense. While the U.S. has slapped an extra 25 percent tariff on Indian goods over New Delhi’s continued purchases of Russian oil, it has so far refrained from imposing similar punitive duties on Chinese goods—a sign, perhaps, of the delicate balancing act Washington is trying to maintain with Beijing.
For the Chinese delegation, the Madrid talks were an opportunity to push back against what they described as the “abuse” of export controls and to press for reductions in the steep tariffs—totaling about 55 percent on Chinese goods—that the Trump administration has extended until November 10. China’s Ministry of Commerce made it clear that the discussions would cover a broad range of economic and trade issues, including tariffs, export controls, and, of course, TikTok.
Meanwhile, the Spanish government seized the moment to reinforce its own diplomatic credentials. Foreign Minister Jose Manuel Albares greeted the delegations at precisely 1:50 PM local time, with the stately Palacio de Santa Cruz providing a suitably grand backdrop. Spain, which has also sought to position itself as a venue for international peace conferences—most notably to resolve the Israel-Palestinian conflict—was keen to use the high-profile meeting to strengthen its bilateral ties with the U.S., especially after a series of tense exchanges with the Trump administration over issues ranging from Israel’s offensive in Gaza to Spain’s refusal to commit to higher defense spending under NATO guidelines.
Not everyone was in a conciliatory mood. Treasury Secretary Bessent, for one, had openly criticized Prime Minister Sánchez for declaring Beijing a “strategic partner” during the height of the tariff offensive in April, quipping that a closer relationship with China was akin to “cutting your own throat.” Such barbed remarks underscored just how fraught—if not outright adversarial—the atmosphere remained, even as both sides professed a desire to keep talking.
Despite the fanfare and the flurry of diplomatic activity, the sense among seasoned observers was that progress would be incremental at best. As Wendy Cutler put it, “Frankly, I don’t think China is in any rush to do an agreement where they don’t get substantial concessions on export controls and lower tariffs, which are their key priorities. And I don’t see the United States in a position to make major concessions on either, unless there’s some breakthrough on its demands to China.” The core U.S. economic complaints—chiefly, that China should shift its economic model toward greater domestic consumption and reduce its reliance on state-subsidized exports—remain deeply entrenched issues that could take years to resolve.
Still, even the modest outcome of another TikTok extension and a renewed commitment to dialogue may help keep the relationship from deteriorating further, at least for now. The Madrid talks, while unlikely to produce dramatic headlines, have set the stage for potentially more significant negotiations later in the year—possibly between Trump and Xi themselves. For Spain, the event showcased its growing clout as a neutral venue for global diplomacy. For the U.S. and China, it was another round in a seemingly endless contest, with the world watching closely for any sign of movement.
As the delegations departed Madrid, one thing was clear: the path to a stable and mutually beneficial U.S.-China trade relationship remains long and winding, with plenty of hurdles still to overcome. But as long as both sides keep talking, there’s at least a glimmer of hope that progress—however slow—remains possible.