Other key topics include the Iran war, an ongoing trade truce, Chinese cars and Taiwan

What could President Donald Trump and Chinese leader Xi Jinping achieve on AI in their tête-à-têtes this week?

Worries about artificial intelligence really got Washington talking this month - and Chinese President Xi Jinping is expected to join in the discussion when he visits the capital this week.

So what could China's leader and President Donald Trump achieve on AI in their tête-à-têtes on Wednesday, Thursday and Friday?

A major American-Chinese agreement on AI hasn't been looking likely, and a pre-summit meeting on Sunday offered additional signals that the deliverables could be modest. But analysts have argued that small steps on AI are still good.

The commentary from Treasury Secretary Scott Bessent after that meeting on Sunday "is consistent with our expectation that there will be no substantive agreement on AI, but rather discussions about process," said Evercore ISI analysts in a note. Bessent said in the wake of the meeting that he and his Chinese counterpart had agreed to establish a dialogue on AI, with the U.S. proposing a notification mechanism for alerting each other about AI incidents that could affect national security.

Raymond James analysts said there likely will not be "material changes to existing semiconductor export controls or any agreement to slow frontier AI development," but they said that nonetheless "establishing a durable communication channel itself would be meaningful."

The possible "incident hotline" that Bessent described is a "very positive development," said Alvin Wang Graylin, a senior fellow focused on technology at the Asia Society Policy Institute's Center for China Analysis.

"The other thing that has been agreed to, it seems, is that there will be a follow-on discussion at the APEC summit in Shenzhen in November, which I think actually is quite appropriate and gives enough time for more offline discussions to happen," Graylin said during a panel discussion on Tuesday hosted by the Quincy Institute, referring to an Asia-Pacific Economic Cooperation meeting. "Just having these two agreements around AI is already, I think, a successful outcome - not to take away from what might potentially come out of a Thursday discussion."

Trump criticized concerns about AI last week, saying they're part of a hoax and helpful to China as its companies compete with American tech giants. At the same time, he has promised to name an AI czar and set up an "AI Force," which would be similar the U.S. Space Force that he launched during his first term. Trump's moves came after the top U.S. AI companies expressed support for slowing the development of their cutting-edge models earlier this month, citing worries that it's progressing at a rate faster than what humans can safely control.

"What comes out of this meeting with regard to AI is going to be the most important indicator," said Paul Heer, a senior fellow at the Chicago Council on Global Affairs and former U.S. intelligence officer for East Asia, during the Quincy Institute event. "AI is the best example of an issue where U.S.-China cooperation is imperative, but also the best example of an issue where it will be extremely difficult, because of the zero-sum mindset and the competitive focus on both sides."

Trump is slated to greet his Chinese counterpart at Joint Base Andrews on Wednesday afternoon, then on Thursday host a bilateral meeting followed by a state dinner that features tech CEOs. The state visit is expected to end Friday with a tour of the National Archives.

"AI is the best example of an issue where U.S.-China cooperation is imperative, but also the best example of an issue where it will be extremely difficult, because of the zero-sum mindset and the competitive focus on both sides."Paul Heer, a senior fellow at the Chicago Council on Global Affairs

Secretary of State Marco Rubio told Fox News on Tuesday that he didn't know if a U.S-Chinese effort on guardrails for AI would be ready by Thursday, while likening Bessent's proposed notification mechanism to a direct link to the Soviet Union that was in place decades ago. It's "the equivalent of a hotline that we had during the Cold War, where if there is an AI incident that's dangerous and could impact economies or societies and even lead to a conflict between nation-states, we would have the ability to immediately hotline the Chinese and warn them about it, or vice versa," Rubio said.

Beyond the discussion of AI issues, other key topics are expected to get addressed:

Any progress on Iran?

The "most consequential" positive development would be a U.S.-China agreement on Iran as the U.S.-Iran war nears the seven-month mark, said J.P. Morgan analysts in a note.

The U.S. has been cracking down in new ways on countries that continue to do business with Iran, while stopping short of placing secondary sanctions on Chinese banks. It's possible that Beijing could agree to provide "support for a cease-fire, pressure to keep strategic waterways open and tighter controls on identified financial networks," J.P. Morgan's team said. "It would give Trump a visible geopolitical achievement before the midterm elections while protecting China's energy security and legitimate commercial interests, potentially in exchange for narrower U.S. secondary-sanctions spillovers," they said.

Other analysts don't expect a breakthrough, even as oil prices (CL00) (BRN00) have topped $100 a barrel this month. "The bottom line is, I don't think Iran is going to be dealt with very substantially at this summit," said Heer from the Chicago Council on Global Affairs.

Trade truce nears its expiration date

The ongoing U.S.-China trade truce is set to get discussed as well. The truce between the world's two biggest economies doesn't expire until Nov. 10 so there probably won't be an extension announced this week, said U.S. Trade Representative Jamieson Greer in a Bloomberg TV interview on Monday. Greer also said he favored a three- or six-month extension, rather than one that covers the rest of Trump's term.

Could Chinese cars get made here?

Chinese cars may get talked about, too. Earlier this month, Trump told Fox News that he'd "be OK with it" if "China wanted to come in and open a plant to build their cars here." U.S. auto-industry groups then asked Trump in a letter last week to "maintain policies that keep the door firmly shut to Chinese automakers seeking to sell, import or manufacture vehicles inside the U.S."

From MarketWatch's archives (April 2024): One thing Trump and Biden agree on: Keeping this $10,000 Chinese EV out of the U.S.

And see: Americans would love this $25,000 hybrid SUV from China - but it's not available here

Board of trade, critical minerals

Greer, the U.S. trade chief, told Fox News on Monday that the summit will deliver more details for a "board of trade" plan that was discussed in May, saying there will be "a small subset of goods that we can just keep aside from any trade disputes."

Meanwhile, Capital Alpha Partners defense analyst Byron Callan said he's watching to see if China continues to allow exports of rare-earth materials and battery-related items to the U.S. The permission for such exports is set to end Nov. 27, but Callan expects that it will be extended, though the announcement may not come until mid-November.

Callan also said Trump could agree to further delay a U.S. weapons deal with Taiwan, the island nation that China wants to control.

The 'most plausible' results

"The most plausible outcomes from this week's summit will likely be narrow and importantly, reversible in design, including limited tariff relief, possibly stronger purchase commitments in areas like agriculture and aircraft, licensing changes, or more procedural agreements or commitments to 'cooperate' on a narrow set of issues, including AI safety and Iran," Oxford Economics analysts said in a note. "That would leave the thornier issues around tech rivalry, transshipments and Taiwan unresolved."

-Victor Reklaitis