The meeting between U.S. President Donald Trump and Chinese President Xi Jinping on October 30, 2025, in Busan marked the first in-person contact between the two leaders since 2019 and was widely regarded as an important indicator of the current state of US-China trade relations. During the meeting, the two sides reached an oral understanding aimed at temporarily stabilizing the most sensitive areas of bilateral trade.
The US administration agreed to reduce the so-called “fentanyl tariff” to 10% and to postpone the introduction of new sanctions targeting Chinese companies. In return, Beijing committed to a one-year suspension of its planned export restrictions on rare earth elements as critical components for electronics, high-tech manufacturing, and defense industries. This move carries considerable weight, as The Times of Central Asia notes that China processes around 90% of the world’s rare earth metals and accounts for approximately 70% of global extraction, making it a central supplier in international value chains.
Despite the positive tone of the announcement, experts have described the outcome as a tactical pause rather than a strategic shift. According to Lukas Fiala, Director of the China Foresight Project at LSE IDEAS, the meeting represents a temporary truce intended to reduce the risk of further escalation without addressing the structural roots of competition. Fiala emphasizes that the fundamental drivers of strategic rivalry as technological autonomy, industrial policy, and supply chain control remain unchanged and will continue to shape the nature of US-China relations.
Analysts cited by The Times of Central Asia similarly argue that the Busan agreement does not signify a strategic rapprochement between the two powers. Rather, it reflects an attempt to reduce short-term volatility amid global market fluctuations, the downturn in the electronics sector, and rising demand for critical minerals. Many experts thus interpret the talks as a form of “recalibration”, through which both sides seek to minimize geoeconomic risks without altering their long-term strategic orientations.
For Central Asia, the Trump-Xi negotiations carry particular significance. The temporary easing of tensions between Washington and Beijing may reduce external pressures that had driven the US to accelerate the diversification of critical mineral supply chains. However, the long-term logic remains unchanged: structural competition between the US and China will persist, and the diversification of supply routes, including those running through Kazakhstan, Uzbekistan, and other regional states, will remain a core strategic objective for Washington. In this sense, the Busan meeting sets the tone for the next phase of dialogue rather than redefining the strategic priorities of either side.
In sum, the Busan negotiations embody a combination of tactical de-escalation and ongoing structural competition. While they have softened immediate trade frictions, they do not alter the strategic trajectories of either Washington or Beijing. For Central Asia where US-backed initiatives on critical minerals and infrastructure are advancing, this development underscores the need to maintain a multi-vector foreign policy while remaining attentive to potential adjustments in US messaging amid the short-term stabilization of the US-China dialogue.
* The Institute for Advanced International Studies (IAIS) does not take institutional positions on any issues; the views represented herein are those of the author(s) and do not necessarily reflect the views of the IAIS.
