【TMGM Financial Recap】The Eighth Round Of China-US Talks Begins In New York, Paving The Way For The September 24 Special Conduct Meeting

Since the launch of the Geneva talks in May 2025, China-U.S. economic and trade consultations have successively visited Geneva, London, Stockholm, Madrid, Kuala Lumpur, Paris, and Seoul—seven stops—all chosen as third countries to maintain a sense of neutrality; This round of negotiations went directly into New York, the first time in 16 months. Bloomberg's analysis offers two interpretations: either it indicates increased trust between the two sides, or it is simply convenient—the UN General Assembly will open next week in New York, and the summit will be held in Washington on September 24, making it easiest to hold the meeting in the same way. But regardless of which interpretation is used, the next round of negotiations is very likely to be hosted by China, and this equivalence itself indicates that the mechanism is moving toward normalization.

The weight of the attendees is also worth recording. Before entering, Becente told reporters he was looking forward to "focused, satisfactory, and constructive talks," then posted on social media, positioning the trip as a paving stone for Xi's "historic summit." According to CNBC, the September 24 state banquet guest list already included Altman, Jensen Huang, JPMorgan CEO Dimon, and Citi CEO Fraser. This effectively signaled to the market in advance that technology and finance are no less important than tariffs on the agenda of this summit. On the Chinese side, the Chinese side is also ramping up, with the Ministry of Commerce confirming that He Lifeng will lead a corporate delegation to the U.S., mirroring Trump's May visit to Beijing with a group of American CEOs; Bloomberg revealed that the Chinese side is considering adding BYD to the accompanying list.

The urgency of the negotiations comes from a specific date. The ceasefire agreement reached in Busan in November 2025: the U.S. will cap the tariff on China at about 20%, expiring on November 10, with neither side announcing renewal terms yet. This truce itself is a "temporary structure on the rubble": the U.S. Supreme Court previously ruled that Trump's tariffs under the International Emergency Economic Powers Act were illegal, and the government subsequently invoked a 10% global surcharge under Section 122 of the 1974 Trade Act and reinstated 12.5% tariffs on Chinese goods based on forced labor investigations. The tariff wall is being rebuilt piece by piece with new authority. The Busan ceasefire has tempered the intensity, but the structure remains unchanged.

For this reason, the most likely "deliverable" in this round of negotiations is to push existing semi-finished products forward by one step. One is the $30 billion reciprocal tariff reduction framework: during the May Seoul negotiations, both sides agreed in principle under the Trade Council mechanism to each contribute $30 billion or more in corresponding tariff reductions for products, with products of mutual interest expected to be subject to most-favored-nation or even lower tariff rates. The Ministry of Commerce's statement on September 17 was that "the team is maintaining close communication on relevant topics and will release progress in due course." The other is China's procurement commitment: to purchase an additional $17 billion of U.S. agricultural products annually and purchase over 200 Boeing aircraft. All these unresolved matters from the May Beijing meeting are awaiting implementation.

There's no need to guess the U.S. motives for staying alive. November 3 is the midterm elections, and inflation remains the top concern for voters. Any new round of tariffs will directly affect shelf prices. Bloomberg reported that the new "overcapacity" tariffs the U.S. originally planned to announce have been deliberately postponed until after the meeting. Wendy Cutler of the Asia Society Policy Research Institute summed up this situation accurately: the U.S. goal toward China is no longer to "reform and strengthen this relationship," but to "maintain stability, prevent escalation, and sustain the Busan armistice."

Two New Lines Of Discussion: Iranian Oil And The Weight Of AI

The biggest difference from previous rounds is that the agenda includes two variables outside the traditional trade framework. The first is the Iran war. China is at the heart of the problem in Washington's eyes: it is Iran's largest buyer of oil, providing Tehran with an economic lifeline, while the U.S. Treasury is putting pressure on financial institutions handling such trade, and the market is already speculating whether Chinese banks will become targets of the next round of sanctions. How sensitive this issue is can be seen from Becent's actions; during a congressional hearing on September 15, he revealed that he had privately discussed the matter with Chinese officials. The truce concerns tariffs between the two sides, while the Iran issue hides the landmine of financial sanctions. If these two logics collide, the damage far exceeds trade friction.

The second is AI, which for the first time became a formal topic in China-US economic and trade talks. This week, Beckent told Axios: "We are open to discussing avoiding common risks and avoiding the split between the two major systems"; He previously called for China and the US to reach a consensus on AI "safety guardrails," with consultations covering "open and closed weighted models," the former referring to publicly downloadable and fine-tuning models, which are precisely the intersection of the two technical paths. The differences are equally clear: the US restricts China's access to advanced chips and accuses Chinese companies of "distilling" US models to gain capabilities; China refuses to let Washington lead AI rulemaking, with the Foreign Ministry labeling the "slowdown" call as "panic selling." Interestingly, the China-US version of this debate happens to be isomorphic to the internal debate within Silicon Valley. A week ago, Amodei called for "slow down" and Huang's direct counterattack are now being brought to the negotiating table between the two governments as they were.

100% Secondary Tariffs Under The Graham Act

On September 18, Trump signed the "2026 Lindsey Graham Sanctions Against Russia and Iran Act," a political legacy of hawkish Senator Graham, who died in July this year. It passed the Senate in August by 86 to 11, and by 262 votes to 159 in the House on September 16. The bill authorizes tariffs of up to 500% on goods directly imported from Russia; What truly targets China is Article 113: within 30 days of the bill taking effect, the President may impose up to 100% sub-tariffs on Russian crude oil or natural gas exports from the top five major importing countries to the U.S., and is not subject to other legal provisions. The crude oil list includes China, India, Slovakia, Hungary, and Azerbaijan; the natural gas list includes China, France, Japan, Hungary, and Belgium—China is included in both

But a close reading of the terms reveals that the handle of this knife is held in the White House's hands. The bill retains broad exemptions and presidential discretion; as long as the exemption is stated to "serve U.S. national interests," any sanctions or tariffs can be left unused. In other words, signing into law does not mean it will be enforced; it is more like a negotiating tool ready to be used: against Russia, it is a bargaining chip. Zelensky thanked them, Medvedev responded with "direct military deterrence," and the Russian Embassy in the U.S. warned that pushing oil prices higher amid significant cuts in Middle Eastern oil supplies could backfire on the U.S. before the midterm elections; For China, it is another table hanging over consultations and summits: the 30-day clock after the bill takes effect, the ceasefire expiration date on November 10, and the midterm elections on November 3—three countdowns overlap in the same autumn.

The Chinese Ministry of Commerce's response maintained a baseline stance: opposing unilateral sanctions without UN authorization, opposing secondary sanctions based on third-party involvement, and reserving the right to take all necessary measures. This statement was sent simultaneously with the signal to "reserve sufficient room for consultation," serving as a standard footnote to the "strike while negotiating" approach.