Xi Stalls on TikTok Deal, But Agrees to Meet at APEC in Seoul

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The two main outcomes of US President Donald Trump’s call to his Chinese counterpart Xi Jinping were ‘progress’ on a TikTok deal and agreement to meet in Seoul in six weeks – to talk more about trade, fentanyl and the war in Ukraine.

The leaders’ first call in three months appeared to lower tension between the two sides, but fell short of finalizing the TikTok deal. That may be part of a Chinese plan to draw the trade talks out as long as they can.

Trump, meanwhile, may also charge a large fee for negotiating the deal (more on that below).

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The leaders did agree to further talks on the sidelines of the Asia-Pacific Economic Cooperation (APEC) forum that starts on October 31 in Gyeongju, South Korea.

Trump also said he would visit China early next year and that Xi would come to the US at a later date. These plans have been reported previously.

“He approved the TikTok deal,” Trump told reporters in the Oval Office on Friday, adding that there could a formal signing of the agreement.

“The TikTok deal is well on its way.”

Trump also suggested positive movement on trade, fentanyl and the Russia-Ukraine war during the call, which he said lasted for about two hours.

“I believe he would like to see it ended,” Trump said of Xi’s view of the Russia-Ukraine war.

China drags out TikTok approval

Beijing’s final approval of a framework deal reached by the two sides earlier this week is one of the hurdles Trump needed to clear to keep TikTok open. Congress ordered the app shut down for US users by January 2025 if its US assets weren’t sold by Chinese owner ByteDance.

China’s statement made no reference to a formal agreement on TikTok. Trump had signalled many times this week that a deal might be forthcoming.

“China’s position on the TikTok issue is clear: The Chinese government respects the wishes of the company in question,” the government said in a statement that called for non-discriminatory treatment of its companies.

“The US will work with China on the economy and trade, and support their teams in reaching a proper deal on TikTok through consultation.”

The White House and the Chinese government did not immediately respond to requests for further comment.

“Beijing is banking on optics and time, while Washington is chasing a TikTok headline and a summit, and hopes, I think, for more wins later,” said Craig Singleton, a senior fellow at the Foundation for Defense of Democracies, a think tank. “I think the Chinese are very happy with the current dynamic.”

Security concerns remain on TikTok

Trump has declined to enforce the TikTok law while his administration looks for a new owner, but also because he worries a ban on the app would anger TikTok’s huge user base and disrupt political communications.

Key questions about the deal remain. They include the ownership structure of the company, how much control Beijing will retain over the app’s inner workings, what concessions Trump will demand from the parties involved and whether Congress will endorse it.

“It’s all being worked out,” Trump told reporters, responding to a question over whether the United States or China would have control over the app’s algorithm. “We’re going to have very tight control.”

Asked whether the US government would control a board seat, Trump said, “We’re going to announce it.”

He also floated the possibility that the US government might take a fee for helping broker a deal to keep TikTok online, but added that such a provision “hasn’t been fully negotiated.” The Wall Street Journal has reported it would be a multibillion-dollar fee.

The deal would transfer TikTok’s US assets to US owners from ByteDance, while downsizing its holding to below 20%. Sources familiar with the deal said US TikTok would still make use of ByteDance’s algorithm.

That arrangement worries some lawmakers who think Beijing could spy on Americans or conduct influence operations through the app. China has said there is no evidence of a threat posed by the app.

Tariffs target China’s export focus

Since retaking office in January, Trump has sharply hiked tariffs across the board and singled out China’s export-oriented economy with punitive rates. That prompted China to respond in kind. Tariff rates on both sides of the Pacific rose to triple-digit percentages in April.

A succession of limited agreements since May paused the tit-for-tat tariff war between the two countries.

Taxes on US importers have been a key part of Trump’s economic policy. He’s raised them to the highest levels in nearly a century while positioning his foreign policy approach as one of peace-seeking and deal-making.

The Republican has portrayed tariffs as a way to recoup lost manufacturing jobs, cut chronic federal government deficits, correct perceived trade imbalances and bend foreign countries to Washington’s will. Many economists regard across-the-board tariffs as inefficient, saying they raise consumer prices and limit choices.

Despite the tariffs, China remains America’s third-largest trading partner and the source of its largest bilateral trade deficit in goods. Recent data point to slowing economies in both China and the United States.

Trump has threatened but so far withheld punitive tariffs on Chinese exports related to the country’s purchases of Russian oil.

At the same time, regional worries are multiplying over Taiwan and the South China Sea, risky flashpoints that struggle to command as much attention in Washington as the wars in Russia-Ukraine and Gaza.

Neither country’s statements following the call mentioned Taiwan.

Former US Attorney General Merrick Garland talks to a reporter in front of images of hundreds of fentanyl overdose victims (Toronto Star).

Other key issues include US demands that China crack down on the export of fentanyl-related chemicals, long blamed for US overdose deaths. Beijing has accused Washington of distorting the issue.

US banker freed

On state-run Xinhua news, Xi said his call with Trump was positive and constructive. He said China’s position was clear on TikTok and that the US should refrain from imposing unilateral tariffs.

It said Xi told Trump US-China trade relations were important.

“On TikTok, Xi said China’s position is clear: the Chinese government respects corporate will and welcomes companies to conduct business negotiations on the basis of market rules to reach a solution consistent with Chinese laws and regulations and a balance of interests,” the summary said.

In a sign of goodwill prior to the call, China permitted the departure of Wells Fargo banker Chenyue Mao, who had been prevented from returning to the United States for several months.