Trump expects to cut fentanyl tariff, discuss Nvidia in talks with Xi

SEOUL – US President Donald Trump said he expects to lower tariffs the US has imposed on Chinese goods over the fentanyl crisis and speak with China’s Xi Jinping about Nvidia Corp’s flagship Blackwell artificial intelligence chip, as leaders of the world’s biggest economies seek to ease tensions in a meeting on Oct 30.  

“I expect to be lowering that because I believe they’re going to help us with the fentanyl situation,” Mr Trump told reporters on Air Force One as he headed to South Korea on Oct 29, a day before he was slated to meet the Chinese President.

Mr Trump said he expected Beijing would be “doing things” and would work with him directly to address the export of precursor chemicals critical to manufacturing fentanyl.

He did not provide further details on the magnitude of the tariff reduction. 

The Wall Street Journal reported on Oct 28 that Mr Trump was considering cutting the 20 per cent tariff to as low as 10 per cent on Chinese goods over fentanyl.

Mr Trump also suggested he was open to providing China with access to Nvidia’s Blackwell AI processor as part of a trade deal, which would represent a major concession and rile up national security hawks in Washington.  

“We’ll be speaking about Blackwell,” Mr Trump said, touting the chip as “super duper” and years ahead of what was currently available from other countries.

He said Nvidia chief executive Jensen Huang recently brought a version of the chip to the Oval Office for him to see.

Nvidia climbs

AI bellwether Nvidia’s shares extended gains to 8.5 per cent in Asian trading on the alternative platform Blue Ocean after Mr Trump’s remarks, signalling potential further gains when US markets open.

The remarks by the US President – which were followed by the prediction of a “great deal for both” nations at a meeting of corporate leaders at the Asia-Pacific Economic Cooperation (Apec) summit – further elevated expectations for the completion of a broad deal that eases trade barriers between the world’s two largest economies.

“The world is watching, and I think we’ll have something that’s very exciting for everybody,” Mr Trump told the summit.

The discussion could also dramatically alter the trade of advanced technology between the two countries.

Mr Huang said at an event in Washington earlier on Oct 28 that the chipmaker has not yet sought US permission to sell its Blackwell AI processor in China, because the authorities in Beijing have barred the company from shipping to the Chinese market.

The Nvidia chief said his company has excluded China from its forecast and that its market share in the world’s second-largest economy has dropped to zero, even after Mr Trump relaxed export controls on some of its less-advanced AI chips in exchange for giving the US government a 15 per cent cut of the sales.

“The President has licensed us to ship to China, but China has blocked us from being able to ship to China,” Mr Huang told reporters at a company event in Washington. “They’ve made it very clear that they don’t want Nvidia to be there right now.”

Earlier in 2025, the US government said it would approve licences for Nvidia’s H20 chip, which was specifically designed to comply with US export controls, though those shipments have not yet occurred.

China is eager to reduce the tariff burden on goods it sends to the US.

Halving fentanyl tariffs would reduce the average tariff on most Chinese imports to around 45 per cent – assuming Mr Trump also holds off on other threatened duties – and would make Chinese goods more competitive with other US trading partners that have benefited in recent months from lower tariff rates.

Table set

Chinese and US officials reached a broad framework agreement at the weekend in Malaysia, setting the table for Mr Xi and Mr Trump to finalise a trade deal that would roll back many of the tariffs, fees and export restrictions threatened or implemented in recent weeks.

The agreement is expected to otherwise keep tariff rates on Chinese goods steady, with Beijing delaying for at least a year the announced

restrictions on its rare earths exports

.

Mr Trump had earlier plans to hike the surtax on most Chinese goods by 100 per cent on Nov 1 if a deal with Mr Xi was not struck.

After negotiators said China planned to resume soya bean purchases, the country booked shipments for at least two cargoes of the American crop, its first known purchase this season, according to people familiar with the matter.

In exchange, the US will hold off on threatened export controls on software that would restrict Chinese access to a broad swath of technology.

The leaders are also expected to agree to reduce shipping fees and approve the sale of the US operations of ByteDance’s social video app TikTok to a consortium organised by the Trump administration.

Mr Trump downplayed the notion that he and Mr Xi would discuss the fate of Taiwan, even as Beijing has signalled an interest in discussing the US position towards the island, and US officials have said the pair plan to discuss an overarching global security effort.

Still, the US has indicated it is unwilling to change its policy towards Taiwan. 

“I don’t know that we’ll even speak about Taiwan,” Mr Trump said. “I’m not sure – he may want to ask about it. There’s not that much to ask about Taiwan.” BLOOMBERG