CNBC news magazine The China Connection: Costs have been lowered. Trust did not.

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CNBC news magazine The China Connection: Costs have been lowered. Trust did not.

Hello, this is Evelyn, writing to you from Beijing. Welcome to the latest edition of China Connection — a short summary of what I see and hear from local businesses.

Now that the Trump-Xi summit has helped keep prices in check, Chinese companies and US officials alike are using the extended agreement to keep some deals going. But is that enough to overcome data security and branding hurdles?

It’s a big story

For businesses navigating US-China tensions, “the worst is over,” said Zou Ping, founder of AI Speech., he told me in Suzhou last week.

It was only a few days after he returned from the US, one of the company’s key growth markets as it pushes for sales of high-end microphones, speakers and tablets that take digital notes.

The company’s speakers and microphones use the device’s AI capabilities to improve sound quality and are widely used in company meeting rooms and university classrooms, he said.

The timing couldn’t be better.

Earlier this month, the US and China agreed to pursue “constructive strategic stability,” marking a broader effort to stabilize relations after a year of heightened tensions and tariff hikes that at one point forced more than 100% more jobs.

Now, the extended deal suggests those taxes could stay at about half those levels for a long time.

For Zou, pricing and market access remain major issues. But at least for the next three to five years, he hopes that US-China relations will not continue to deteriorate.

The biggest challenge to winning American customers, he said, is marketing.

AI Speech is exploring acquisitions and local hires as part of its US expansion strategy, he said, pointing to talks with New York electronics retailer B&H.

The theme echoes conversations I’ve had with other executives: recent trips to the US and Europe, discussions with major American retailers and renewed plans for overseas growth.

“We are talking to him Best Buy right now,” Guo Renjie, CEO of humanoid robot Zeroth, told me in Suzhou last week.

He said the company received several orders at the Consumer Electronics Show in January, and plans to begin sales this fall in the US and Europe, initially focusing on a toy-sized interactive robot.

The logos of Best Buy and Target are shown as people wait in line to buy Pokemon trading cards during checkout outside a Best Buy store in West Hollywood, California, on March 27, 2026.

Patrick T. Fallon Afp | Getty Images

To encourage investment

Chinese investment in the US has declined over the past decade.

Still, officials on both sides are looking at areas where cooperation is still possible.

The US and China said this month they would establish trade and investment boards focused on sensitive sectors, US Treasury Secretary Scott Bessent told CNBC.

Fast-growing Chinese consumer goods companies are also exploring overseas acquisitions, such as the reported acquisition of sustainable fashion brand Everlane by online retailer Shein.

At the government level, engagement continues.

“I see a lot of collaboration happening, “said Andrea Chartock, assistant director in the office of the Department of Commerce for Economic Development and Competitiveness in Washington State. A few days ago, I spoke at an event for the Chinese delegation and we made some presentations from Washington State and Seattle as well as from the Chinese side,” he said.

Chartock spoke with me in Chongqing last week as part of a delegation from Seattle. These two metropolitan areas have for decades been “mother cities” – a municipal-level agreement to facilitate international trade and commerce.

A few days later in Suzhou, trade ministers from the 21 countries of the Asia-Pacific Economic Cooperation gathered for a conference.

Casey Mace, APEC’s top US official in attendance, told me how Washington is pushing American AI solutions across Asia while also encouraging more investment in the US.

The Trump-Xi summit, he said, had contributed to a “positive” tone in recent working-level talks.

Chinese companies, on the other hand, are trying to get ahead of data security issues and tax-related risks.

Zou emphasized that AI Speech products do not upload user data, and that US customers who choose to purchase any AI features will be served through its international data centers.

And Zeroth’s Guo said he is looking at US manufacturing options, particularly in Texas, to reduce tax exposure.

At the end of the day, he said, “China and the US are still big markets.”

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