The U.S. & China

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US announces massive package of arms sales to Taiwan valued at more than $10 billion, angering China

WASHINGTON (AP) — President Donald Trump’s administration has announced a massive package of arms sales to Taiwan valued at more than $10 billion that includes medium-range missiles, howitzers and drones, drawing an angry response from China.

https://apnews.com/article/trump-taiwan-arms-sales-china-2743b66e3a4e47a895e731568cef9008?

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China blocks Nvidia H200 AI chips that US government cleared for export – report

Suppliers of parts for Nvidia’s H200 have paused production after Chinese customs officials blocked shipments of the newly approved artificial intelligence processors from entering China, according to a report.

https://www.theguardian.com/technology/2026/jan/17/china-blocks-nvidia-h200-ai-chips-that-us-government-cleared-for-export-report?

ps:Not sure I understand that!! What are they afraid of? Isn't that what they wanted??

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🇨🇳 China threatens U.S. drug-making crown

By Caitlin Owens

Illustration: Sarah Grillo/Axios

China has gotten so good at making cutting-edge pharmaceuticals that it seriously threatens America's long-standing dominance in drug-making, Axios Future of Health Care author Caitlin Owens writes. China is "really very close to us," Pfizer CEO Albert Bourla told CNBC at Davos. "If they continue like that with that strength, they will become better than us. I think it's a wake-up call for us." Why it matters: "If the United States loses its primacy in biopharmaceutical innovation, it risks weakening the financial and intellectual engine that drives broader biotechnology leadership," the National Security Commission on Emerging Biotechnology wrote in December. Keep reading.

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💊 China threatens U.S. pharma

Illustration: Aïda Amer/Axios. Photo: Peng Bin/VCG via Getty Images China's emergence as a second hub of pharmaceutical innovation could trigger massive changes to the global drug market, including how treatments are regulated and priced in the U.S., Axios' Caitlin Owens reports. Why it matters: More cutting-edge therapies are generally a good thing for patients, regardless of where they come from. But the new world order could spark questions over who'll access those therapies and where money flows. 🇨🇳 By the numbers: China went from being the country of origin for just 8% of the world's drug development in 2015 to 32.3% in 2024, according to a new study published yesterday in JAMA. 🇺🇸 The U.S., on the other hand, lost ground. In 2015, 48.2% of new programs originated here. By 2024, that number dropped to 37.4%. During that time, the number of U.S. drug development programs grew from around 5,000 to around 7,000 — but the Chinese programs skyrocketed from fewer than a thousand to more than 6,000. 🧑🏼‍🔬 Between the lines: The more China succeeds at getting drugs beyond early stages of development, the more likely it is that U.S. regulators will have to make tough decisions about how to evaluate the products. And Chinese companies could eventually compete with Western ones on price, undercutting today's lucrative financial model. Read more.

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🇨🇳 New playbook to counter China

Illustration: Sarah Grillo/Axios

Axios managing editor Dave Lawler — attending the Endless Frontiers conference in Austin with 200 top tech founders, policymakers and private equity investors to discuss America's competition with China — isolates these four takeaways from the summit: Beating China to the Moon — and using robotics to build a base once there. Breaking China's chokehold on U.S. AI development, particularly on critical minerals. Turning to startups to equip the military of the 21st century, at the expense of the traditional big defense contractors (think Boeing, Lockheed Martin, Northrop Grumman). AI innovations like a secretive DARPA platform now being used to war-game a potential Pacific conflict. Between the lines: The invite-only gathering includes Trump officials David Sacks and Jacob Helberg, alongside Jim Mattis and Jake Sullivan.

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US-China relations

President Donald Trump will travel to Beijing today for a high-stakes summit with Chinese leader Xi Jinping, where the war in Iran is expected to be a major focus. China has long been a close ally of Iran and is the main importer of Iranian oil. The trip comes as Trump said the ceasefire with Iran is on "life support" and as aides say he is more seriously weighing renewed combat operations. Read more.

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Trump and Xi appear intent on keeping deep differences over Iran war from overshadowing China summit President Donald Trump is set to leave Tuesday for Beijing to meet with President Xi Jinping after weeks of trying, and failing, to persuade the Chinese government to use its considerable leverage to prod Iran to agree to U.S. terms to end the two-month war — or at the very least, reopen the Strait of Hormuz. Read more.

Why this matters: Trump has veered between venting that China, the world’s biggest buyer of Iranian oil, hasn’t done more to get the Islamic Republic in line, and acknowledging that Xi’s government helped de-escalate the conflict last month by nudging Tehran back to ceasefire talks when negotiations wobbled. Lately, the Trump administration seems determined not to let differences on Iran overshadow efforts to make headway on other difficult matters — ranging from trade to further Chinese cooperation to block exports of fentanyl precursors.

RELATED COVERAGE ➤ What to know about Trump-Xi summit with trade, Taiwan and Iran on the agenda   WATCH: Chinese people share mixed feelings about Trump’s visit

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China’s Xi warns Trump that differences over Taiwan could lead to conflict

BEIJING (AP) — China’s Xi Jinping warned President Donald Trump on Thursday that their two countries could clash over Taiwan if the issue is not handled properly, an unusually harsh admonition that stood in contrast to the American leader’s praise for his counterpart.

https://apnews.com/article/trump-xi-china-iran-trade-a1d63a711a037472f5c1c330c2120bd5?

🇺🇸 🇨🇳 Xi warns Trump about Taiwan

As a two-day summit began in Beijing today, China's Xi Jinping warned President Trump that Washington's handling of Taiwan could lead to "conflicts."

• His tone was a sharp contrast to Trump, who praised his Chinese counterpart and declared: "It's an honor to be your friend."

The pair talked trade and other issues for two hours behind closed doors at the Great Hall of the People. According to a Chinese readout, Xi told Trump that "the Taiwan question is the most important issue in China-U.S. relations." (AP)

Apple CEO Tim Cook, part of a big delegation of U.S. business leaders joining the summit, flashed a peace sign when pool reporters shouted questions as he left the welcome ceremony.

• Nvidia CEO Jensen Huang said: "Meetings went well … Mr. Xi and President Trump were incredible."

Musk, who stood behind Trump officials along with 13 other CEOs, said he wants to accomplish "many good things" in China.

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And we see the comments made of the decline of the United States, the fall of the Roman Empire comes to mind...

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Historic summit

Chinese leader Xi Jinping hailed a new era of US-China relations defined by "stable" ties during talks with President Donald Trump in Beijing today. Their multi-day summit has struck a notably conciliatory tone, with both leaders extending a hand of partnership as Xi said they agreed to establish a "constructive strategic" relationship over the next three years and beyond. But Xi also warned that Taiwan "is the most important issue in China-US relations" and it could create a "very dangerous situation" if mishandled. Read more.

WATCH: Group of cheering children welcomes Trump in Beijing

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Trump offers platitudes while Xi warns of possible confrontation during China summit Chinese leader Xi Jinping cautioned visiting President Donald Trump that Washington’s handling of its relations with Taiwan could lead to “conflicts.” His tone was a sharp contrast to Trump, who opened the highly anticipated summit with Xi by praising his Chinese counterpart and declaring that “it’s an honor to be your friend.” Read more.

Why this matters: It underscored just how far apart the leaders remain on thorny issues including the war in Iran, trade disputes and Taiwan — and suggested that Trump’s three-day visit to China is likely to be longer on pageantry and symbolism than major bilateral breakthroughs.

RELATED COVERAGE ➤ Live updates: Xi and Trump’s closed-door meeting   WATCH: Trump declines to say if he and Xi discussed Taiwan   Jury convicts man accused of running secret Chinese spy outpost in New York City

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🇨🇳 Trump tries to defy gravity

President Trump's summit with Xi Jinping was staged as a reunion between old friends, concluding today with a private tour of Zhongnanhai, the Chinese Communist Party's secretive leadership compound, which includes Xi's official residence, Axios' Zachary Basu writes.

• Strolling the gardens, Trump declared the blooms around him "the most beautiful roses anyone has ever seen." Xi promised to send him seeds.

Why it matters: The warm public choreography of the past two days has masked a stubborn reality — nearly every force shaping U.S.-China relations is pulling them apart.

• Trump spent the trip pitching closer ties with China after a decade of decoupling that he, more than any other American president, helped set in motion.

The two wrapped up today by declaring success and claiming progress in stabilizing U.S.-China relations. But deep differences persist between the world's two biggest powers on Iran, Taiwan and more.

• Over tea and lunch, Trump and Xi, with top aides and translators in tow, huddled for nearly three hours of talks before the U.S. leader completed his historic three-day trip to China.
• "This has been an incredible visit," Trump said. "I think a lot of good has come of it. We've made some fantastic trade deals — great for both countries."
• Xi called it a "milestone": "We have established a new bilateral relationship, or rather a constructive, strategic, stable relationship."

🦅 Zoom in: China hawks in Trump's administration worked in the days and weeks leading up to the summit to undercut the case for rapprochement. Consider:

• New sanctions on firms helping Iran target U.S. forces and refineries buying Iranian oil.
• A White House memo accusing Chinese entities of "industrial-scale" theft of American AI secrets.
• Federal charges unsealed against a California mayor for acting as an illegal agent of the Chinese government.

🕵️‍♂️ The intrigue: Leaks from inside the government paint an even more hostile picture of the U.S.-China rivalry.

• A U.S. intelligence assessment reported by the Washington Post found that China is exploiting the Iran war to gain ground over the U.S.
• The New York Times reported Wednesday that Chinese companies are negotiating clandestine arms sales to Iran.
• Trump told Fox News's Sean Hannity that Xi assured him China won't supply Iran with military equipment. "But at the same time," Trump added, "he said they buy a lot of their oil there, and they'd like to keep doing that. He'd like to see Hormuz Strait opened ... I said, well, we didn't stop it. They did it."

🥂 The other side: While warning Trump that mishandling Taiwan could provoke "an extremely dangerous situation," Xi played his own part in the summit's friendly choreography.

• At yesterday's state banquet, Xi told Trump that China's "great rejuvenation" could go "hand in hand" with "Make America Great Again."

🕊️ Between the lines: Both leaders have clear incentives to maintain the truce, for now at least.

• Trump doesn't need any more election-year economic shocks. Xi likely believes "strategic stability" with the U.S. will help China push ahead with its own military and technological ambitions.
• As the leaders play nice, their governments are working furiously in the background to reduce their dependence on one another.

The bottom line: Two aging nationalist leaders, presiding over the world's most dangerous rivalry, spent the week performing a friendship neither of their governments seems willing to sustain.

• Video: Trump addresses reporters.

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China agrees to boost trade for US ag products such as beef and poultry following Trump-Xi summit The White House announced Sunday that China will buy at an annualized rate of $17 billion per year for 2026 and at that level for 2027 and 2028. The deals are on top of previous commitments to buy U.S. soybeans. Read more.

Why this matters: The agreement comes as China sharply cut back on U.S. imports last year after Trump launched a trade war against the country. It offers some hope to American farmers harmed by the trade war as they saw a major export market dry up.   The agreement includes restoring market access for U.S. beef and resuming poultry imports from certain states. There was no immediate confirmation of the terms from Beijing, but China on Saturday had signaled progress.

RELATED COVERAGE ➤ Takeaways from Trump’s trip to China   Trump returns from Chinese state visit to face economic challenges at home   Taiwan’s president defends US arms purchases that Trump called ‘bargaining chip’   WATCH: US farmers turning to automation amid labor shortages and aging workforce

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China AI surges, rivalry intensifies

Illustration: Annelise Capossela/Axios

America's commanding lead in advanced AI is gone. A Chinese moonshot — literally and figuratively — has caught up to models that defined the U.S. frontier just weeks ago, at a substantially lower price, Axios' Zachary Basu, Madison Mills and Ben Berkowitz report. Why it matters: Kimi K3, a massive new model by Beijing-based Moonshot AI, threatens the foundations of America's AI boom. Its release yesterday dazzled developers, jolted Silicon Valley and reset the AI race overnight. Driving the news: Kimi immediately vaulted into the top tier of global AI, beating Anthropic's Fable 5 and OpenAI's GPT-5.6 Sol in front-end coding tests by AI evaluator Arena. In Arena's broader text ranking, Kimi finished ahead of Anthropic's Opus 4.8 — the company's flagship model until Fable 5 arrived in June — while costing 40% less. Unlike the premium U.S. models it's challenging, Moonshot plans to release Kimi as an open-weight model on July 27 — allowing companies and governments to customize and run it on their own systems. The big picture: Even as Chinese open-weight models have gained momentum, U.S. AI leaders and policymakers took comfort in estimates that China remained six to 12 months behind the American frontier. Between the lines: Kimi doesn't have to be the world's single best model to upend the market. Its very existence puts pressure on the pricing power of U.S. labs, the enormous valuations built around their technological edge, and the case for spending hundreds of billions of dollars on ever-larger data centers. The other side: America's frontier labs are hardly out of ammunition — and Kimi may itself reflect the power of U.S. technology. Anthropic has accused Moonshot and other Chinese labs of industrial-scale "distillation" campaigns, allegedly using millions of exchanges with advanced American models as training data for their own systems. 👉 But the strategic problem remains. Even if U.S. labs pull ahead again, China has shown it can close the gap quickly. What's next: The Trump administration needs to maintain American AI competitiveness amid calls to regulate frontier models. Tougher safety rules could slow U.S. labs just as China accelerates. Looser oversight could help them move faster, but raise the risk of releasing dangerous capabilities. The bottom line: America may still push the frontier forward. It can't stop the rest of the world from choosing a cheaper alternative. Go deeper: China's open-weight Kimi model stuns AI world with frontier-level results.

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Chinese AI model takes US tech industry by surprise with abilities rivaling Claude and ChatGPT

Another powerful new artificial intelligence model from China took the U.S. tech industry by surprise Friday, the latest sign that Chinese startups that publicly release their “open-source” AI technology are making the California titans of AI sweat. Read More.

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Squeezing China on AI

Illustration: Sarah Grillo/Axios

The Trump administration is showing signs it could ban cutting-edge Chinese AI models — a momentous move that could lock in dominance by OpenAI and Anthropic, Axios' Maria Curi writes. Why it matters: Parts of the administration have tried to implement de facto bans on foreign open-source models before, knowledgeable sources tell Axios. Last week's rise of Chinese model Kimi is reigniting those efforts. The big picture: U.S. companies are increasingly using open-source models from China because they're cheaper and, as seen by the rise of Kimi, just about as good as the domestic tech. Kimi and other Chinese models such as DeepSeek and GLM allow users to download and customize them. They have fewer guardrails, lower cost and more flexibility than the closed American models. Between the lines: The administration wouldn't need to impose an outright ban to get U.S. companies to drop those Chinese platforms. "What's actually happening is slower and more durable," a source familiar with government discussions said, citing procurement rules, Entity List threats and public pressure campaigns aimed at U.S. companies using Chinese models. Instead of a ban, another source familiar with government discussions described a push to highlight potential backdoors and lack of security with Chinese models, and the governance issue that brings. It's an offensive approach where the administration encourages a more innovative U.S. open-source ecosystem, the source added. Screenshot: @DavidSacks/X The other side: Some administration officials keen on keeping regulation from stifling innovation, including former White House adviser Sriram Krishnan, have left the premises. National security hawks have grown louder. With that shift in personnel — along with the rise of more powerful Chinese tech and fresh cybersecurity fears — momentum for a ban is picking up. Outside White House adviser David Sacks escalated the fight publicly yesterday, writing on X: "We are at a critical inflection point in AI policy. The leading closed labs, already a duopoly in terms of AI model revenue, want the government to eliminate their open source competition. They have laid their cards on the table. It is time for the rest of Silicon Valley — the vast majority that still values open competition — to do the same."

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China's new AI model halts new subscriptions as demand swamps capacity

The new, powerful Chinese artificial intelligence model Kimi K3, which has caused a stir in the U.S. tech industry, has suspended new subscriptions after a flood in demand overwhelmed capacity within days of the launch. Read More.

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Winning the future

Illustration: Sarah Grillo/Axios. Stock: Getty Images

America has been napping or distracted by trivialities while China is racing toward the future, in part by taking advantage of President Trump's trade, immigration and budget policies. That's the eye-opening reality that Evan Osnos unfurls in a 12-page piece for The New Yorker, "The Future, Made in China." Why it matters: China could beat the U.S. to the future on a host of fronts, including engineering a cure for cancer. 🇨🇳 "For China, America's retreat comes just as decades of state investment, industrial policy, and diplomatic planning are paying off," Osnos writes. An American executive told him: "People in Washington are worried that biotech is the next E.V.s ... We've scared all of this f*cking talent back to China. If you look at the guys who are doing this, they used to work for Western pharma giants, or they were running a top university department somewhere." In a flex, China now welcomes Western influencers, investors and commentators on "tech tours" that yield "infrastructure porn" and "Chinamaxxing." 🛂 Being there: Osnos, who lived in Beijing for eight years as a foreign correspondent, returned for 10 days as part of four months of reporting. He says the capital is noticeably quieter than when he left in 2013 — "an awkward serenity to life in the capital of a high-tech, one-party state." "The vehicles, many of which are electric now, move silently through the streets, and in any case the residents have fewer reasons to go out; China has the world's busiest e-commerce market, and there isn't much that can't be delivered on the back of a scooter," he writes. "All day long, people scan each other's QR codes to swap cash on such digital-payment systems as WeChat and Alipay, feeding the algorithms an ever more intricate portrait of their movements and preferences." 👁️ The surveillance future is here: Osnos felt constantly watched — because he was, including psychologically. At an AI expo in Beijing, Osnos stood in front of a kiosk that took an emotional X-ray by measuring "micro-gestures" in his face. The results: He possesses 76.67% positive emotion and 23.33% negative emotion, split between fear and rage. The state can use such readings to zero in on potential disruptors. The same manufacturer makes a scan for schools that assigns pupils an alert level of red, yellow or blue. By the numbers: China produces 70% of the world's drones, electric vehicles, lithium-ion batteries and solar cells, the magazine says, and "deploys more industrial robots than the rest of the world combined, and, in medicine, it has surpassed the United States in the number of registered clinical trials." China's shipbuilding capacity is 200 times that of the U.S. 💡 Between the lines: China's rulers avoid "overtly antagonizing America, because they believe that, even in decline, it remains uniquely dangerous." But Rush Doshi, China specialist at Georgetown and CFR, says that if the U.S. loses the next wave of industries — AI, biotech and robotics — as it lost on solar panels, batteries and electric vehicles, "it would irreversibly change the balance of power." A think tank at Renmin University of China, in Beijing, published a report called "Thank Trump," which argues that his tariffs, attacks on allies and immigration policies have hastened the "twilight of an empire." The bottom line: A European diplomat who has attended meetings with Xi Jinping and his advisers told Osnos they're "feeling like the champions of the world." Keep reading.