As the world’s two largest economies prepare to meet in Madrid, all eyes are on the high-stakes negotiations between the United States and China—a diplomatic dance that could shape global trade, national security, and even the political fortunes of leaders on both sides of the Pacific. Starting Sunday, September 14, 2025, US Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng will sit down for four days of face-to-face talks in the Spanish capital, with a host of contentious issues on the table and a November deadline looming over their heads.
According to the South China Morning Post, this marks the fourth major round of such talks since the trade war reignited earlier this year. The stakes are sky-high: the current US-China trade truce, which has already been extended twice for 90 days each, is set to expire on November 10, 2025. Without a breakthrough, both sides risk slipping back into another spiral of retaliatory tariffs and economic uncertainty.
Both governments have confirmed that the agenda will be packed. The US Treasury has stated that Bessent and He will "discuss key national security, economic and trade issues of mutual interest, including TikTok and cooperating on money-laundering networks that threaten both the United States and China." China’s Commerce Ministry echoed this, specifying that "the two sides will discuss economic and trade issues such as the US’ unilateral tariff measures, the abuse of export controls, and TikTok."
For many observers, the inclusion of TikTok is not just about a popular app. The US, after enacting the "TikTok Prohibition Act," has been pushing China to agree to the sale of TikTok’s US operations, citing national security concerns over data privacy and potential foreign influence. The talks will also delve into joint efforts to combat money laundering, with the US suspecting Chinese networks may be involved in laundering funds for international drug cartels.
But the headline issues don’t stop there. Tariffs are very much back in the spotlight. Earlier this year, both countries imposed escalating tariffs on each other’s exports, prompting a flurry of diplomatic activity. In May, the first round of high-level talks in Geneva resulted in a significant lowering of tariff rates—each side slashed 91 percentage points out of the 115% additional tariff rate and suspended the remaining 24 percentage points for 90 days. A second round in London and a third in Stockholm followed, with each round extending the tariff moratorium. According to the White House, the grace period now runs until a minute past midnight on November 10, 2025. If the Madrid talks fail, a new round of trade conflict could erupt—something both sides seem keen to avoid, at least for now.
Stephen Olson, a former US trade negotiator now at Singapore’s ISEAS – Yusof Ishak Institute, put it bluntly to the South China Morning Post: "If the US and China would like to accomplish something beyond just another extension by [November 10], the pace, tempo and depth of discussions will have to intensify."
Recent developments suggest a thaw, however slight, in the frosty relationship. Back-to-back meetings between senior diplomats and defense chiefs from both nations took place just days before the Madrid summit. US Secretary of State Marco Rubio told his Chinese counterpart Wang Yi that he sought "constructive and open dialogue" with China. Meanwhile, Chinese Defense Minister Dong Jun warned US Secretary of Defense Pete Hegseth that "containing, deterring, or interfering with China will be futile," but also called for "an equal, respectful, peacefully coexistent, stable and positive military-to-military relationship."
There’s also a political backdrop to all this. President Donald Trump has stated he expects to travel to China this year or soon after, a move that could cap a period of improved economic ties. The Madrid talks are widely seen as a possible precursor to a historic summit between Trump and Chinese President Xi Jinping, potentially during the Asia-Pacific Economic Cooperation (APEC) summit next month. As Bloomberg and The Washington Post have both reported, expectations are growing that such a meeting could finally materialize, especially as high-level diplomacy continues apace.
Spain, meanwhile, finds itself in a unique position as host. According to Reuters, the Spanish government views these talks as a chance to mend its own strained relations with the US. Tensions flared recently after Prime Minister Pedro Sanchez announced plans to limit access to Spanish ports and airspace for ships and planes carrying weapons for Israel—a move the US described as "deeply concerning." Sanchez also irked Washington by refusing to meet NATO defense spending targets, prompting Trump to threaten new tariffs against Spain. Yet, Spain’s relationship with China has grown warmer, with Sanchez visiting China three times in as many years and abstaining from an EU vote on tariffs against Chinese electric vehicles. Hosting the talks could give Madrid leverage in future negotiations with Washington and bolster its standing as a mediator within the EU.
“We do not yet know who requested it (Spain hosting the meeting) – whether it was the Chinese – but it is good for Spain,” José-Ignacio Torreblanca, a senior adviser to the European Council on Foreign Relations, told Reuters. He added that the opportunity to speak with Bessent "would give Madrid an advantage" in future dealings with the US.
For their part, the Chinese media have struck an optimistic tone. An editorial in the Global Times described the recent flurry of US-China contacts as "another sign that relations between the two countries are continuously improving this year," adding that it has "instilled positive and certain expectations in the global economy and international markets." The editorial also noted that increased high-level communication "greatly reduces the risk of misunderstanding and misjudgment" and "creates an environment favorable to solving global challenges such as public security and supply chain stability."
Still, the road ahead is anything but smooth. The US recently withdrew the nomination of Landon Hyde, a hawkish figure for the Department of Commerce, in what some see as a goodwill gesture toward China. Hyde had played a key role in regulating AI chips and biotech exports—a flashpoint in ongoing tech tensions. But with the November deadline fast approaching, it remains to be seen whether Madrid will yield a lasting settlement or simply another extension of the uneasy truce.
After the talks in Spain, Secretary Bessent will continue to London for meetings with British officials and business leaders before joining President Trump for an official state visit with King Charles at Windsor Castle, according to the Treasury Department.
As the world watches, the outcome of this week’s Madrid meetings could well determine the next chapter in the US-China saga—whether that’s a new era of cooperation, another round of brinkmanship, or something in between.