Trump-Xi meeting: China's self-sufficiency shifts trade calculus

President Donald Trump and Chinese President Xi Jinping are expected to meet this week for their second in-person summit of the year, with U.S. concerns about artificial intelligence gaining prominence ahead of the talks. Businesses hope for an extension of a trade truce reached last fall, though tariffs have done little to dent America's appetite for Chinese goods. Despite ongoing domestic challenges, China's persistent export growth and self-sufficiency efforts have reduced threats to its domestic market. U.S. trade deficit with China has risen again this year due to surging demand for AI-related parts, and Asia still accounts for over 60% of U.S. imports. China reached 40% of global container exports this summer, years ahead of previous expectations. China's real estate downturn since 2022 pushed companies to expand globally, with a direct correlation between lower export prices and accelerated export volumes. However, AI-related exports fell significantly in August, and economists don't expect major policy changes. Domestic competition has surpassed geopolitical tensions as the top challenge for foreign businesses in China, while the EU is starting to scrutinize China-origin exports.