President Trump says US and China are close to a trade deal ahead of Xi Jinping meeting and TikTok decision

US President Donald Trump said on Monday ahead of his scheduled meeting with Chinese leader Xi Jinping that the US and China are ready to “make a deal” a trade deal.

Trump, speaking aboard Air Force One en route from Malaysia to Japan, added that a final agreement on TikTok could be signed as early as Thursday.

“I have great respect for President Xi, and we will reach an agreement,” Trump said.

On Sunday, he began a whirlwind week-long tour of Asia, focusing on trade and mineral deals with partners Malaysia and Cambodia, as well as the framework for trade deals with Thailand and Vietnam.

The four countries, part of an 11-nation regional bloc called the Association of Southeast Asian Nations (ASEAN), have pledged to eliminate trade barriers, provide preferential market access to U.S. products and increase purchases of U.S. agricultural products, energy products and aircraft.

The two countries also agreed to cooperate with Washington on export controls, sanctions and access to critical minerals, a move seen as strengthening President Trump’s position in a region where Beijing’s influence is growing.

Wendy Cutler, senior vice president at the Asia Society Policy Institute, said the deal focuses on “cooperation rather than hard commitments” and is “much shorter” than previous U.S. trade deals in many important ways.

“If the United States deems Malaysia to be in breach of its commitments, it can impose tariffs or terminate the agreement,” Cutler added.

President Trump is scheduled to meet with Prime Minister Sanae Takaichi and Emperor Akihito in Japan, before concluding his visit to South Korea with the Asia-Pacific Economic Cooperation (APEC) summit.

Chinese Premier Li Qiang, who was in Malaysia to attend the 28th China-ASEAN Summit, also stopped by Singapore and witnessed the signing of eight agreements covering trade and the digital economy.

Although diplomatic momentum appeared strong, few details were released about the scope of the new trade framework.

Under the agreement, the United States will maintain 19% tariffs on most exports from Malaysia, Cambodia and Thailand, while some products will not be subject to tariffs, according to a joint statement from the White House.

According to the joint statement, tariffs on Vietnam will remain at 20% and some products will be exempted from duty. Vietnam, which had a $123 billion trade surplus with the United States last year, has also pledged to step up purchases of American goods to address the trade imbalance.

Malaysia agreed not to impose any bans or quotas on exports of critical minerals to the United States, and to accelerate the development of rare earth projects needed by American companies.

The country, which is home to an estimated 16.1 million tonnes of rare earth deposits, has imposed a nationwide moratorium on exports of unprocessed rare earth materials since last year to prevent the development of downstream industries and resource exploitation.

Thailand will accept some U.S.-made cars, medical equipment and pharmaceuticals, and will ease tariff barriers on U.S. products by importing ethanol for fuel use. It also promised to ease foreign ownership restrictions for U.S. investors in the telecommunications sector.

Michael Wang, an economist at Bank of Mitsubishi UFJ, said the agreement leaves open the possibility that additional product exclusions may be decided in the future. He noted that sectoral tariffs on pharmaceuticals and electronics will remain key, as will questions surrounding the legality of President Trump’s use of emergency powers to impose them.

Separately from the trade deal, President Trump announced the formalization of an extended ceasefire between Thailand and Cambodia, building on the ceasefire brokered in July following violent border clashes between the two countries this summer.

President Trump, who has appointed himself a world peace broker, said the deal “shows that his administration has accomplished what many have said was impossible, and we have probably saved millions of lives.”

“My administration immediately began working to prevent the conflict from escalating,” Trump said. “Everyone was surprised that it was completed so quickly.”

U.S. and Chinese negotiators met on the sidelines of an ASEAN summit while President Trump met with other leaders in Malaysia, and a framework was finalized in bilateral talks ahead of a meeting between Trump and Xi scheduled for Thursday in South Korea.

“The market is becoming increasingly accustomed to ‘first to attack, second to negotiate’ tariffs,” said John Woods, chief investment officer at Lombard Odier.

China’s top trade negotiator, Li Chengang, said on Sunday that a tentative agreement had been reached after “very intense discussions” on a wide range of issues, including export controls, fentanyl and shipping charges.

He said the next step is for both sides to complete the domestic approval process.

U.S. Treasury Secretary Scott Bessent said in an interview with CBS on Sunday that President Trump’s threat of 100% tariffs was “effectively off the table” after “two days of very good talks” with Chinese officials.

Speaking separately on ABC News’ “This Week,” Bessent said the negotiations had created a “substantive framework” to allay U.S. soybean farmers’ concerns about a Chinese boycott.

China purchased more than half of U.S. soybeans in 2023 and 2024, accounting for nearly $12.8 billion in 2024. But the Chinese government suspended purchases earlier this year after President Trump triggered a trade war.

Bessent also told ABC News that China is expected to delay rare earth export restrictions by a year that are expected to go into effect in the coming weeks. Bessent added that Trump and Xi could “work out” an agreement that would allow TikTok to continue operating in the United States.

“We think it is likely that both sides will test the other’s boundaries and then make concessions again,” said Ting Lu, China economist at Nomura.He added that 100% tariffs on Chinese goods “certainly will not happen” and predicted that both sides would likely extend the existing tariff truce.

In return, the Chinese government could resume purchasing U.S. soybeans and ease enforcement of rare earth export controls, Lu added.