Donald Trump and Xi Jinping will meet in Washington on Thursday for a state dinner at the White House. Tech leaders from OpenAI and Nvidia have confirmed attendance as key agenda items are discussed.
The proposed hotline
The main proposal is a notification system between the US and China. This would function like the Cold War hotline with Moscow, allowing each side to alert the other about national security issues related to AI. Treasury secretary Scott Bessent first announced this system on Sunday alongside Chinese vice premier He Lifeng.
Officials in the Trump administration tell Inner Loop that finalising an agreement will take several weeks. They remain optimistic the hotline could be operational before the year ends, but progress is slower than hoped.
Several details require formalisation. These include establishing benchmarks for what constitutes a national security incident, which remains unclear, and securing explicit agreement from China, which has been noncommittal.
The administration targets a functional framework by Bessent’s next meeting with Lifeng in Shenzhen in two months. Crucially, this framework must be agreed to by Trump.
Discussions highlight growing concern over the capabilities of frontier AI models as the US and China race for dominance. Officials have discussed criteria for when each country must alert the other and enforcement measures to ensure the US does not simply notify China without reciprocity.
Export controls and enforcement
Developing a framework with enforcement measures could take time to gain White House approval. The US is expected to extend a trade truce, and Trump is reluctant to stop exports of Nvidia chips to China.
The administration has granted limited licenses this year for Nvidia to sell its H200 chip to China. This component allows AI labs to increase compute power for training models. Nvidia supporters argue that restricting sales incentivises Chinese firms like Huawei to develop their own technology. Recent reports suggest Huawei has already achieved this milestone with commercially available AI chips.
Who leads the AI Force
The notification system may be delayed while Trump decides who to appoint as the next AI czar to lead a so-called AI Force. This role would handle interagency coordination.
Bessent has been floated as a candidate, but it is unclear if he is the standout choice. Commerce secretary Howard Lutnick and White House AI officials Michael Kratsios and Sean Cairncross are also in the mix. Sources tell Inner Loop that it is unclear if Trump will choose someone to wear two hats or depart their current role for the position.
The previous AI czar, David Sacks, served as a special government employee. Sources say Sacks is not considered to be returning.
The push for Bessent stems partly from the view that the notification system mirrors the US-China dialogue between former Treasury secretary Hank Paulson and former Chinese vice premier of finance Wang Qishan. During the 2008 financial crisis, Paulson credited the hotline with helping to stave off a large portion of US government sponsored debt issued by Freddie Mac and Fannie Mae being dumped by China.
Meanwhile, some Trump officials have chafed at the idea of giving more AI power to Lutnick. He remains in contention because he oversees the Center for AI Standards and Innovation, which successfully navigated crises with frontier AI model companies this summer.
What it means
For people making things, the immediate effect is uncertainty. The lack of a clear enforcement mechanism means rules on chip exports and model safety could remain inconsistent. This creates a patchwork environment where some developers get access to powerful tools while others face restrictions, depending on shifting political priorities rather than settled policy.
