Iran focus at Trump-Xi summit may delay progress on tariffs, rare earths

BEIJING — The Iran war is likely to take center stage in the summit between President Donald Trump and China’s Xi Jinping, leaving less scope to resolve issues like tariffs and rare earth supplies.

Treasury Secretary Scott Bessent has already said Iran will be a topic in the meetings, which are due to take place May 14 and 15. And earlier this week, China hosted Iran’s foreign minister for the first time since the war began in late February — raising hopes for a peace deal, sending oil prices lower and fueling stock-market gains.

The U.S. government declined China’s invitation to organize industry-specific meetings between senior Chinese leaders and U.S. CEOs, thinking it could make American businesses appear too close to Beijing, according to a U.S. executive with direct knowledge of the arrangements. As of Tuesday, the White House had yet to formally invite executives to join Trump on the trip, and a proposed list of two dozen leaders could be halved, the person added.

Boeing CEO Kelly Ortberg is set to accompany Trump, a source told CNBC on Thursday, as the U.S. aircraft giant hopes to seal its first large order from China in nearly a decade.

Citigroup CEO Jane Fraser on Friday confirmed CNBC’s reporting that she also plans to attend the trip.

“I think it’s very important to see engagement” between the two economic superpowers, she told CNBC’s Leslie Picker. “We all need that engagement to be occurring.”

Fraser also stressed the importance of China to her company.

“From the Citi perspective, we’ve been in China for 124 years. It’s a very important market,” she said. We’ve got many of the multinational clients that operate there in China. We’re also watching a lot of the Chinese companies growing and expanding globally to the benefit of all.”

Xi has hosted a dozen national leaders this year, from the U.K. to South Korea — who often bring large business delegations. Still, corporations may not object to the decreased focus if it resolves a large geopolitical overhang for them.

An end to the Iran war would be a “great relief to global business,” said Hai Zhao, a director of international political studies at the Chinese Academy of Social Sciences, a state-affiliated think tank. It would “be remembered as very much the success” for the Trump-Xi summit.

However, the U.S. and Iran have traded fire in the Strait of Hormuz again, each blaming the other for initiating the attack. Just a few days earlier, a Chinese-owned oil tanker was also struck, according to Chinese media outlet Caixin. CNBC was unable to independently confirm the report.

If a smaller group of executives joins Trump’s visit to China, it would contrast with the president’s trip to Saudi Arabia last May, when more than 30 U.S. executives accompanied him. When Trump visited China during his first term in 2017, the last sitting U.S. president to do so, nearly 30 CEOs accompanied him – signing 37 major deals worth more than $250 billion.

But the expected images of Trump and Xi together may still send a signal within China that it’s more acceptable again to engage with U.S. businesses, said Michael Hart, president of the Beijing-based American Chamber of Commerce of China.

“Since U.S. military actions earlier this year, Chinese officials have been more hesitant to engage with the American business community,” he said.

China welcomes U.S. business expansion and hopes the companies can keep advancing bilateral economic relations, the foreign ministry told CNBC. China’s commerce ministry didn’t respond to a request for comment.

Meanwhile, the urgency of some business-related issues is declining. Both countries are backpedaling on recent confrontation around U.S. sanctions and tech, while eyeing cooperation on the growing security threat of AI, according to reports.

And some progress may still be made. Trump is expected to notch deals on Chinese purchases of U.S. soybeans and Boeing airplanes, according to Scott Kennedy, senior advisor and trustee chair in Chinese business and economics at the U.S.-based Center for Strategic and International Studies.

He also anticipates Trump will discuss U.S. plans to establish trade and investment organizations – called “boards” – to handle specific bilateral issues.

“The meeting most likely will solidify the advantages China has gained over the past year,” Kennedy said.

Beijing’s focus will likely be on tariffs, Taiwan’s status and U.S. restrictions on Chinese access to advanced technology, Kennedy said. China was the first major country to retaliate against tariffs announced by the Trump administration in April 2025.

Meanwhile, changes to China’s increasingly tight rare earths export controls would be felt worldwide, and they affect all countries, not just the U.S.

— CNBC’s Matthew Chin and Kevin Breuninger contributed to this report.