China and the United States are expected to extend their tariff suspension for another 90 days as trade negotiators from both sides meet in Stockholm this week, according to multiple sources familiar with the matter. While the move offers temporary relief in a prolonged trade standoff, insiders caution that major breakthroughs remain unlikely.
The extension would prolong the current truce, originally agreed in May, which paused most of the punitive tariffs each country had levied on the other. That agreement is due to expire on August 12. During this new period, both sides have reportedly committed not to impose new tariffs or escalate tensions through other means.
“The Stockholm round will be more about laying groundwork and reiterating positions rather than closing deals,” one source said.
During the talks, both delegations are expected to reiterate their views on sticking points — including US concerns about China’s industrial overcapacity and Beijing’s frustration over fentanyl-related tariffs. The additional 20% levy on Chinese imports imposed by US President Donald Trump in March, citing insufficient progress on stopping fentanyl flows into the US, remains a contentious issue.
Beijing, according to sources, views the fentanyl-related tariffs as excessive and unfair but may be open to a compromise that includes a 10% baseline tariff if the additional duties are removed. However, the US side has so far offered little clarity on what constitutes “sufficient progress” on fentanyl to justify any easing.
A recent editorial in People’s Daily, the official newspaper of the Chinese Communist Party, emphasized China’s willingness to work with the US toward “substantive progress” while maintaining a firm position against unilateralism and protectionism.
“China is fully aware of the long-term and complex nature of the negotiations,” the editorial stated, adding that Beijing remains committed to dialogue based on mutual respect.
The Stockholm talks mark the third formal round of negotiations this year, following previous meetings in Geneva and London. US Treasury Secretary Scott Bessent and Commerce Secretary Howard Lutnick are both in attendance. Lutnick told Bloomberg last week that the key issue remains how to expand market access on both sides, though peripheral matters like the future of TikTok may also surface.
TikTok’s ownership structure — with Chinese tech firm ByteDance under pressure to divest its US operations or face a ban — has become a flashpoint in broader US-China tensions, though officials have said it is not formally part of the trade agenda.
Despite the absence of major breakthroughs, analysts have welcomed the continuation of dialogue. Niklas Swanstrom, director of the Institute for Security and Development Policy in Stockholm, described the likely extension as “symbolic but important.”
“Don’t expect a breakthrough, but it would be disappointing if nothing comes out of this,” Swanstrom said.
Frederic Cho, vice-chairman of the Sweden-China Trade Council, echoed that sentiment, calling a 90-day extension “the most probable outcome.”
Meanwhile, some observers believe this round may be laying the foundation for a more meaningful agreement later in the year. Philippe Le Corre, head of the Asia program at France’s ESSEC Business School, suggested a potential deal could be finalized during the Asia-Pacific Economic Cooperation (APEC) summit in South Korea this October, possibly involving a direct meeting between Chinese President Xi Jinping and President Trump.
“These talks are setting the stage,” Le Corre said. “What happens next could depend heavily on what the leaders decide.”
As Washington and Beijing edge toward a cautious stabilization of their economic relationship, the rest of the world — especially Europe — watches closely, though with limited influence. “Europe is left holding the candle,” Le Corre noted. “Until the US and China resolve their differences, the global economic balance remains uncertain.”
