U.S. and China Reach Breakthrough on TikTok — Seen as Prelude to Possible Trump Visit to Beijing

TradingKey – After two days of negotiations in Madrid, U.S. and Chinese representatives struck a framework agreement on TikTok, marking a rare breakthrough in the long-running dispute. U.S. Treasury Secretary Scott Bessent said the deal will be finalized following a scheduled call between President Donald Trump and Chinese President Xi Jinping this Friday.

The talks were led by Chinese Vice Premier He Lifeng. Chief negotiator Li Chenggang described the dialogue as “frank, in-depth, and constructive.” Bessent confirmed that a framework for TikTok’s ownership restructuring is in place, though he stressed that commercial terms remain a matter for private parties.

At the heart of the dispute lies whether ByteDance will relinquish control of TikTok’s recommendation algorithm, a technology listed on China’s export control roster. Beijing has long taken a hard line on this issue.

According to the White House, the final agreement could resemble the April proposal, under which an investor consortium would acquire TikTok’s shares. While Blackstone has dropped out of the potential investor lineup, Oracle is still expected to participate. The negotiation deadline, extended multiple times, remains in place, with U.S. officials warning talks will not drag on indefinitely.

TikTok has been at the center of controversy since early this year, when Trump announced he would not enforce the forced divestiture law and instead embraced the platform during his re-election campaign. He has actively used TikTok to engage younger voters, while the White House even launched an official TikTok account last month — a sharp contrast to his first-term stance, when he sought to ban the app outright.

Analysts view the agreement as part of broader preparations for a potential Trump–Xi summit later this year. Beijing prefers the meeting to take place in China to minimize risks tied to multilateral settings, while Washington is considering the October APEC summit in South Korea as an alternative venue.

China also plans to leverage Premier Li Qiang’s presence at the upcoming UN General Assembly to maintain dialogue, while signaling that if Trump visits Beijing first, Xi would attend the 2026 G20 Summit in the U.S.