The United States and China are considering reciprocal tariff reductions covering approximately $30 billion of non-strategic, non-critical goods from each country, while U.S. Treasury Secretary Scott Bessent has proposed creating bilateral Boards of Trade and Investment to structure future negotiations. Speaking at the BTG Pactual CEO Conference in Sao Paulo, Bessent framed the administration's approach as de-risking rather than decoupling, with sensitive areas such as semiconductors, artificial intelligence, critical minerals, rare earths and national security-related goods remaining under scrutiny. U.S. tariffs reduced the bilateral goods trade deficit by approximately one-third in the first half of 2026 to $73.9 billion, while China's global trade surplus is estimated at $1.2 trillion. Bessent is urging G20 partners to address China's export-led growth model and weak domestic demand. The proposal follows 2025 framework agreements that included delayed Chinese rare-earth export controls and the U.S. withdrawal from a threatened 100% tariff on Chinese imports. Negotiations remain preliminary, and progress will depend on the next round of talks with Chinese Vice Premier He Lifeng, domestic political constraints and unresolved disputes over technology controls, rare earths, fentanyl and Chinese purchases of American goods. The existing one-year trade agreement signed in October 2025 also remains subject to extension negotiations, while the Trump-Xi summit scheduled for September 24 at the White House is expected to test whether limited tariff concessions can be formalized.