Bessent Says China Made ‘Aggressive Asks’ As TikTok Deal Lingers

US Treasury Secretary Scott Bessent claimed Chinese negotiators had made aggressive demands during high-stakes trade talks in Madrid, where haggling over TikTok and export controls was ratcheting up tensions. 

“I think on the TikTok deal itself, we are very close or we’ve resolved the issue,” Bessent told reporters Monday, as he arrived with US Trade Representative Jamieson Greer in the Spanish capital for a second day of negotiations. Signaling friction in those conversations, however, he added the Chinese side had made “aggressive asks,” without elaborating.

Greer added that discussions with the Chinese delegation led by Vice Premier He Lifeng had touched on trade, although they hadn’t “found a path forward on that.”

Minutes after Bessent spoke, the Chinese government announced Nvidia Corp. had violated Beijing’s anti-monopoly laws. The timing of that statement appeared calibrated to thrust US controls that block Beijing from buying cutting-edge semiconductors into the limelight.

Both sides came to Madrid to finalize the technical details of a TikTok deal but demands from the Chinese on trade and other national security issues threaten to derail talks, according to a US official familiar with the matter. China wants to tie trade demands to a TikTok deal, but the US wants to keep both topics separate, the person added. 

TikTok could “go dark” in the US if its Chinese parent company, ByteDance, fails to sell its American operations to an approved buyer before a deadline this week, or if Beijing refuses to approve such a sale. On the matter of TikTok, Trump told reporters Sunday his administration was prepared to “let it die.” 

“This is more like a war of words,” according to George Chen, partner and co-chair of digital practice at The Asia Group, which was co-founded by former US Deputy Secretary of State Kurt Campbell, adding the situation was still manageable. “If both sides come out of the Madrid talks without any indication of progress or what to do next, then I will be worried.”

The US and China enter their latest talks at a delicate diplomatic moment as officials ramp up engagement to set up a potential meeting between Donald Trump and Xi Jinping, which could come soon at a major summit in South Korea. Top diplomats and defense chiefs from each side spoke last week, smoothing the path for their leaders’ first sit-down since the Republican returned to office.

The world’s biggest economies still haven’t reached a trade deal with a 90-day pause on tariffs as high as 145% holding the peace until mid-November. Beijing has shown leverage over the US with its hold over rare earth magnets critical to American manufacturing. But it remains unclear whether Trump would be open to a deal involving Chinese investment, as has been the case with Japan and South Korea. 

Adding to the headwinds, Trump has urged NATO nations to impose tariffs as high as 100% on China for buying Russian oil. Those levies, coupled with US fees already at 55%, could squeeze Chinese shipments just as the country’s industrial output and consumption in August clocked their worst month of this year.

China’s Foreign Ministry hit back on Monday, defending its economic ties with Moscow as legitimate and vowing to “take resolute countermeasures,” raising the possibility of another round of tit-for-tat measures. 

Chinese negotiators will begin talks shortly after fresh data showed their economy slowing more than expected across the board in August, an under-performance that may put more pressure on negotiators. Still, Beijing is on track to hit its annual growth goal and set to hit a $1.2 trillion surplus in 2025, as exports find new markets outside the US. 

The first day of the Madrid talks lasted for almost six hours on Sunday, according to a senior Treasury official, spanning topics including TikTok, trade and the economy. Reuters earlier reported that the Trump administration is expected to again extend the deadline for TikTok divestiture.

Trump granted the latest reprieve even though the 2024 national security law allows for only one 90-day extension of the deadline. His administration has signaled it has a potential buyer ready for TikTok, although attempts to get a deal approved in China were thwarted earlier this year because of trade disputes between the two countries. 

Ahead of the talks on Sunday, China launched two investigations targeting the US semiconductor industry. The probes came shortly after the US added 23 more China-based companies, including chipmakers, to a list of businesses deemed to be “acting contrary to the national security or foreign policy interests of the US.”