A High-Stakes Summit Faces an Unexpected Crisis
What was supposed to be a pivotal trade summit between the United States and China is rapidly turning into a geopolitical stress test. As President Donald Trump prepares for his first official visit to Beijing since 2017, the escalating conflict in Iran threatens to overshadow negotiations on tariffs, supply chains, and rare earth exports.
Global markets, multinational corporations, and policymakers are now watching a far broader question unfold: can Washington and Beijing stabilize their economic relationship while a major Middle East crisis intensifies?
Iran Conflict Shifts the Focus of the Trump-Xi Talks
Treasury Secretary Scott Bessent has confirmed that the Iran conflict will be a primary topic during the May 14-15 meetings. The timing is especially sensitive.
China recently hosted Iran’s foreign minister, a diplomatic move that briefly cooled oil prices and boosted global stocks on hopes of a potential de-escalation. However, those expectations quickly faded as tensions in the Strait of Hormuz intensified.
Recent exchanges of fire in the region – one of the world’s most critical energy corridors – along with reports of a Chinese-owned tanker being struck, have significantly raised the stakes for both Washington and Beijing.
For President Trump, the pressure is mounting domestically. Rising energy and medicine prices have increased the urgency of keeping the Strait of Hormuz open and limiting further military support to Iran. Securing at least limited cooperation from Xi Jinping has therefore become an important strategic objective ahead of the summit.
The Cost of Cooperation Between the US and China
The widening Iran crisis may also reshape the balance of negotiations between the two countries.
Some analysts believe Beijing could attempt to use the situation to press for broader concessions from Washington. Areas of potential leverage include:
Reduced Support for Taiwan
Speculation is growing that China may seek a softer U.S. position on Taiwan in exchange for diplomatic cooperation related to Iran.
Tariff Relief
Beijing continues to push for a rollback of the aggressive tariffs introduced in April 2025, arguing that they have further strained global trade flows.
Technology Access
Chinese officials also remain focused on easing U.S. restrictions on advanced technology exports, particularly in sectors tied to artificial intelligence and semiconductor manufacturing.
Corporate Engagement Appears More Limited Than in 2017
Another notable difference from previous US-China summits is the smaller American business delegation.
In 2017, Trump traveled to Beijing alongside nearly 30 CEOs, helping facilitate deals reportedly worth more than $250 billion. This year, however, the White House appears far more cautious about the optics of corporate engagement with China.
Reports suggest that officials reduced a proposed list of business leaders by roughly half to avoid appearing overly aligned with Beijing during a period of heightened geopolitical tension.
Despite the scaled-back presence, several major executives are still expected to attend.
Boeing Eyes a Major China Aircraft Deal
Boeing CEO Kelly Ortberg is expected to participate in the summit discussions as the company pursues its first major aircraft order from China in nearly a decade.
Citigroup Signals Long-Term Commitment to China
Citigroup CEO Jane Fraser has also confirmed her attendance, emphasizing that China remains an important market for the bank’s multinational clients.
“We all need that engagement to be occurring,” Fraser said, underscoring the importance of continued dialogue between the world’s two largest economies.
Tariffs and Rare Earth Export Controls Remain Central Issues
Although geopolitical tensions are dominating headlines, the underlying economic disputes between the United States and China remain unresolved.
One of the biggest concerns for global manufacturers is China’s tightening control over rare earth exports. These materials remain essential for advanced technology production, electric vehicles, semiconductors, and defense systems.
The issue extends far beyond the United States, affecting supply chains across Europe and Asia as companies search for alternative sources and more stable procurement channels.
Scott Kennedy of the Center for Strategic and International Studies (CSIS) suggested that the summit may ultimately formalize new mechanisms for managing bilateral disputes. At the same time, some analysts argue that China enters the negotiations with stronger strategic positioning than it held a year ago.
Areas Where the Trump-Xi Summit Could Produce Quick Wins
Despite the broader tensions, both sides are still expected to pursue limited agreements that could help stabilize markets and present the summit as constructive.
Agriculture Deals
China may increase purchases of U.S. soybeans and other agricultural products as part of a short-term trade easing effort.
Aviation Agreements
Potential Boeing aircraft orders could provide a symbolic economic breakthrough after years of strained relations.
AI Safety Cooperation
Officials are also expected to discuss possible cooperation on artificial intelligence security risks, an area where both countries have expressed growing concern.
The Global Economy Watches for Stability
For Xi Jinping, the summit offers an opportunity to position China as a defender of global stability amid rising international uncertainty.
At the same time, the Iran conflict creates complications for Beijing as well. While the crisis draws U.S. military attention away from Asia and toward the Middle East, disruptions to oil shipments also threaten China’s own economic interests.
Before the recent escalation, roughly 80% of Iranian oil exports were heading to China. Any prolonged disruption in the Strait of Hormuz therefore creates significant risks for both economies.
That shared vulnerability may ultimately become one of the few areas where Washington and Beijing have a mutual incentive to cooperate.
Can Trade Progress Survive the Iran Crisis?
As the May 14 summit approaches, global investors and political leaders are searching for signs that the United States and China can prevent another escalation in economic tensions.
What began as a trade-focused diplomatic meeting is now unfolding against the backdrop of a rapidly expanding geopolitical crisis. Whether the summit produces meaningful progress – or simply exposes deeper divisions – may shape not only US-China relations, but also the direction of global markets in the months ahead.