What’s Going On
U.S. and Chinese delegations met for a second day of trade negotiations in Madrid on Monday, focused intensely on several hot-button issues — none more urgent than the impending deadline for ByteDance, TikTok’s parent company, to divest its U.S. operations or face a shutdown. The deadline is currently set for September 17, 2025.
The talks are being led on the U.S. side by Treasury Secretary Scott Bessent and U.S. Trade Representative Jamieson Greer, while Vice Premier He Lifeng heads the Chinese side. The agenda includes tariffs, export controls, and other trade frictions.
Key Issues on the Table
- TikTok’s Fate: The U.S. demands a divestment of ByteDance’s ownership of TikTok’s U.S. business; otherwise, the app faces a ban. A fourth extension of the deadline seems likely, depending on the outcome of the Madrid negotiations.
- Tariffs & Trade Truce: Earlier this year, the two sides agreed on a 90-day truce that paused certain tariffs and resumed rare‐earth exports from China. Those agreements are fragile, and both sides are pushing for more concessions.
- Export Controls & Technology: China is looking for relief from U.S. export restrictions on high-tech goods; the U.S. is pushing back, citing national security concerns.
Why It Matters Now
The deadline for TikTok’s U.S. operations is more than just a tech issue — it’s become a diplomatic test case in U.S.-China trade relations. If ByteDance cannot comply with divestment terms by September 17, the U.S. may enforce a ban, which could have massive implications for free speech, the tech sector, and how foreign tech firms with Chinese ties are regulated.
In addition, these talks could set the tone for how trade tensions evolve under Trump’s administration. Some analysts believe that a Trump-Xi meeting might follow depending on the outcomes in Madrid.
What Might Come Out of Madrid
- An extension of the TikTok divestment deadline, giving both sides more time to negotiate a deal.
- Modest movement on tariff reductions or temporary relief, especially in areas like rare earths or agriculture, though any big breakthrough seems unlikely without higher-level diplomacy.
- Clearer commitments (or promises) about export controls, potentially improved access for U.S. tech companies to Chinese markets, depending on what China agrees to reciprocally.
