More positive signals before Trump-Xi meeting
With the Trump-Xi meeting approaching, more positive signals are coming out:
1/ soybean: China’s state-owned COFCO Group purchased three cargoes of U.S. soybeans this week through ports in the Pacific Northwest, totaling about 180,000 metric tons. The shipments are scheduled for loading in December and January.
2/ chips: largely confirmed the potential lift up of B30A export control that many predicted yesterday, but looks like it still needs to be discussed between the two leaders.
3/ port fee: both sides are to reduce their port fee.
4/ fentanyl: The current proposal seems to be that for the U.S. to first cut the fentanyl-related tariff in half to 10%, in exchange for new Chinese measures to curb the export of fentanyl precursor chemicals.
5/ Trump–Xi meeting: China officially announced and confirmed it ; WH official confirmed the meeting planned for mid-morning Thursday, though exact timing remains fluid. Trump told the media that the meeting with Xi would take 3-4 hours. He also sent a post saying again that it will be a great meeting with President Xi.
In terms of the 50% rule, no signs that it will be withdrawn so far. Bloomberg published an interesting report citing two Chinese “U.S.-friendly” scholars, Wu Xinbo and Da Wei, who stated explicitly that the U.S. side would suspend or revoke the 50% rule. They further outlined the additional concessions that Beijing expects, including an easing of export controls in the semiconductor and equipment sectors and the removal of certain Chinese companies from the U.S. Entity List.
However, during a webinar hosted by data analytics firm Kharon, Matt Axelrod, the former BIS export enforcement chief, said BIS 50% rule is unlikely to be traded away with China as it took effect as soon as it was released, which could make it challenging to be recinded.
I don’t think BIS would have done this and done it in the way they did it -- as an interim final rule -- if the intention of the administration was to use it as a poker chip.
When addressing the fentanyl issue, the spokesperson essentially indicated that China’s stance on fentanyl this time is consistent with its earlier position and reflects continuity rather than change. At its core, Beijing’s message remains that it is open to cooperation and has already worked with others, but it will not accept being vilified or pressured in the process.
MOFA Spokesperson statement on related issues:
AFP: The Chinese and U.S. presidents will meet tomorrow in Busan, South Korea. President Trump said he feels optimistic and that many issues will be resolved. What are China’s expectations for the meeting?
Guo Jiakun: Head-of-state diplomacy plays an irreplaceable strategic leading role in China–U.S. relations. At this meeting, the two presidents will have in-depth communication on strategic and long-term issues concerning bilateral relations, as well as on major issues of mutual interest. China stands ready to work with the U.S. to ensure that the meeting produces positive outcomes, provides new guidance, and injects new momentum into the stable development of China–U.S. relations. We will release further information on the meeting in due course.
AFP: Regarding the China–U.S. summit, President Trump specifically mentioned that he might discuss with China the possibility of reducing fentanyl-related tariffs. What is China’s response?
Guo Jiakun: China’s position on this issue is consistent and clear. China has one of the most resolute anti-drug policies, the most comprehensive measures, and one of the best records in the world. It also maintains one of the strictest control systems and the widest catalog of controlled substances globally. China sympathizes with the American people for the suffering caused by the fentanyl crisis and has previously provided assistance that produced positive results. China remains open to continued cooperation with the U.S. in this regard. The U.S. side should take concrete actions to create the necessary conditions for such cooperation.
AFP: According to reports, China has recently purchased soybeans from the U.S., the first such purchase this year. What is your comment?
Guo Jiakun: China’s position on the relevant issue is consistent. For specific details, I would refer you to the competent Chinese authorities.
AFP: NVIDIA CEO Jensen Huang has expressed hope that U.S.-made AI chips could be sold in China. Does China welcome the sale of U.S. AI chips in the Chinese market?
Guo Jiakun: For specifics, I would refer you to the competent Chinese authorities. China has stated on multiple occasions its principled position regarding U.S. chip exports to China. We hope the U.S. will take concrete actions to safeguard the stability of global industrial and supply chains.
Before departing Japan for South Korea, Trump spoke at length with reporters aboard Air Force One, offering a fuller picture that tied together several of the fragmented details previously reported by the media.
Asked whether Xi might raise the Taiwan issue, Trump said he wasn’t sure they would even discuss it, remarking “Taiwan is Taiwan.” He instead emphasized that many of Taiwan’s chipmakers are now investing in the U.S., noting that the world’s largest semiconductor manufacturer is building a massive plant in Arizona and that NVIDIA is “doing unbelievable.” He added that within two years, 40–50% of global chip production would take place in the U.S., driven by tariffs and by Taiwan’s growing concerns about the situation.
When asked whether he would consider lowering the fentanyl-related tariffs during his meeting with Xi, Trump said he expected to do so, expressing confidence that China would help the U.S. address the fentanyl crisis. Pressed on what China was doing in return, Trump said Beijing “has an industry related to drugs” and must act to stop it, noting that cooperation on the issue would be a major topic in his meeting with Xi. Asked whether China would work with U.S. law enforcement, Trump replied, “China’s going to be working with me,” emphasizing that fentanyl would be among several key agenda items, along with agriculture and trade.
On rare earths, he said the two sides hadn’t discussed timing but suggested “we’re gonna work out something,” adding that progress on both rare earths and fentanyl was likely.
Asked whether he would allow NVIDIA’s Blackwell chips to be exported to China, Trump said the issue may come up in his meeting with Xi. He praised the chip as “super-duper,” called NVIDIA CEO Jensen Huang “a brilliant guy,” and noted that Huang had presented him with the first Blackwell chip in the Oval Office three days earlier, describing it as “an amazing thing.”
Whole transcript of President Trump Gaggles with Press on Air Force One, Oct. 28, 2025
Trump:
We had a great trip to Japan and it was really wonderful. Malaysia, fantastic. Hundreds of billions of dollars are coming into our country primarily because of the election result. But the real reason is tariffs. The tariffs are coming.
As you know, last night I was with a lot of the greatest leaders in Japan, the biggest business people, and Mister Toyota was there from Toyota. And he’s agreed to invest $10 billion in building auto plants. You’re gonna build numerous auto plants throughout the United States with American workers, as you know. And it’s tremendous — it’ll be one of the biggest investments ever in the auto business. This is just AI. This is in the auto business. So.
Reporter: And that was because of tariffs?
Trump: Yeah, sorry. If you build up the United States, you don’t have any tariffs. So everyone’s coming in. We’re up to close to $20 trillion of investment. And yesterday, as you saw, we picked up about $518 billion. Those are big numbers. Numbers that no country has ever seen before.
And we’re now going — there’s another South Korea that I’m meeting tomorrow with President Xi.
Reporter: Mr. President, on the Xi meeting — are you expecting or do you anticipate being willing to lower the fentanyl-related tariffs?
Trump: I expect. I expect to be lowering that because I believe that they’re gonna help us with the fentanyl situation. They’re gonna be — oh, good — what they can do.
Reporter: And on rare earths, sir, do you need to see more than just a one-year delay? Is that sufficient to make other concessions?
Trump: We haven’t talked about the timing yet, but we’re gonna work out something. We’re doing very well with rare earths, as you know, and I think we’re gonna make a big step with fentanyl.
The thing with fentanyl on the border is now so tough. It’s much tougher for them. Doing very well with that. I call them the “drug boats.” You know, we took out four of them last year, and they’re really stopping. They’re not coming anymore. They’re coming by land — to a lesser extent — and if necessary, we’re gonna do well.
The boats are very few and far between. We took in tremendous amounts of death — tremendous amounts of death — coming into our country. Each one of those boats is estimated to kill about 25,000 people if it got through. Not even talking about the destruction to families.
Over the last two days, I guess we took out four. But there are very few now — that’s down about 80% by water. Drugs by water are down about 80%, and I would imagine it’s gonna be pretty close to 100%. Nobody wants to do it anymore.
Reporter: So what is China doing to justify removing fentanyl tariffs?
Trump: Well, I think they’re going to do things. You know, they have an industry that has to do with drugs — and fentanyl has other reasons for being — and we have to get rid of it. We have to stop it.
And now we’re stopping it at the border to a much larger extent than ever before. Under Biden — open borders, the stuff was flowing in. I think they killed 300,000 people last year.
Now nobody gets through the southern border. We’re being very tough. We’re allowing people in — but they’re coming legally, through the legal process. And I want to commend our border agents. They’ve been amazing. ICE too — those people do such a great job.
Memphis is making tremendous progress — crime is already down to less than 50%. A lot of criminals, career criminals, people that came in illegally have been sent back. And we tell them if you come back again, it’s gonna be brutal.
Reporter: Just to clarify — so China’s going to be working with U.S. law enforcement on fentanyl, or how is that going to work?
Trump: China’s going to be working with me. Okay? They’re going to be working with me, and we’re going to do something, I believe. I mean, look, we have to have the meeting tomorrow. That’s a big meeting.
And fentanyl will be one of the things that we’re discussing — important. We’ll be discussing the farmers, too, and a lot of other things.
Trump (cont’d): Last night I met with Toyota, and we had an amazing meeting. I said, “What’s your name?” He said, “Toyota.” I said, “You’re rich.”
And he’s going to invest $10 billion in the United States to build manufacturing plants — build cars with American workers. It’ll be tremendous.
We’re getting all our manufacturing back — in the car business and in AI. We’re leading China; we’re leading the world in AI.
Reporter: Do you expect Xi to push you on Taiwan?
Trump: I don’t know that we’ll even speak about Taiwan. He may want to ask about it — there’s not much to ask. Taiwan is Taiwan.
But the beautiful thing is, we’re bringing a lot of their chipmakers into the U.S. The No. 1 chipmaker in the world is building a massive factory in Arizona — the biggest in the world. NVIDIA’s doing unbelievable.
Within two years, 40 to 50% of the chip market will be here. That’s happening because of tariffs — and maybe because they’re a little concerned about the situation.
Reporter: Have you agreed — or will you agree — to allow NVIDIA’s Blackwell chips to be exported to China?
Trump: Blackwell — we’ll be speaking about that. It’s the super-duper chip. NVIDIA makes it, and Jensen’s a brilliant guy — probably 10 years ahead of anyone else.
You can’t really copy that — in chips it doesn’t work that way. Jensen gave me the first Blackwell chip three days ago in the Oval Office — amazing thing.
We may be talking about that with President Xi.
Reporter: Some say there’s an AI bubble. Are you concerned?
Trump: No. It’s everything — internet, data, energy. Everyone wants it. The only challenge is you need massive amounts of electricity, and we’re letting companies make their own.
They’re building incredible new power plants — far more advanced than anything we’ve seen before. It’s almost a revolution in how we generate power.
Reporter: Speaker Johnson says he told you there’s no time to amend the Constitution to allow a third term.
Trump: I don’t want to talk about that. I have the highest numbers I’ve ever had — greatest economy in history, lowest energy prices. Beef’s a little high — we’ll fix that.
Stock prices and 401(k)s are through the roof. The greatest economy we’ve ever had. We’ll see what happens.
Reporter: Are you trolling when you talk about a third term?
Trump: (laughs) I don’t think so. I just said — I’ve got the best numbers of any president in years. But we have a lot of great people.
Reporter: Would you bring Democrats in to have a healthcare discussion now?
Trump: I’d say open up the government and we’ll work. A lot of good things can happen.
Thank you very much. We have two big days — today’s a big day, we’re speaking at APEC, and tomorrow morning’s the one everyone’s watching — the meeting with President Xi of China.
I think we’ll have a great meeting. A lot of problems are going to be solved together.
Reporter: Are you optimistic?
Trump: I am. The relationship with China is very good. I think we’ll have a very good outcome — for our country and for the world.
Reporter: You met with the Japanese Prime Minister today?
Trump: Yes — she’s fantastic. Very sharp, very smart, very energetic. The first woman ever to be Prime Minister of Japan — and she’ll go down as one of the greats.
I had a fantastic relationship with Shinzo Abe — a great man, horribly assassinated. He was my best relationship. And she comes from that same mold.
He would have supported her. He gave me the putter he used — I played golf with him — great man.
Thank you very much, everyone.