USA ( Europe Brief News): President Trump announces U.S.-China trade deal is “done” after talks yield a framework to lift export curbs and stabilize fragile economic relations.
U.S. Commerce Secretary Howard Lutnick said that two days of intense negotiations in London had put “meat on the bones” of an agreement made last month in Geneva to reduce bilateral retaliatory tariffs that had risen to crippling triple-digit levels.
Trump used his social media platform to share some of the first details of the agreement.
“Our deal with China is done, subject to final approval with President Xi and me,”
Trump said on the Truth Social platform.
“Full magnets, and any necessary rare earths, will be supplied, up front, by China. Likewise, we will provide to China what was agreed to, including Chinese students using our colleges and universities (which has always been good with me!). We are getting a total of 55% tariffs, China is getting 10%.”
The 55%, according to a White House official, is the total of the following: a baseline 10% “reciprocal” tariff that Trump has placed on goods imported from almost all U.S. trading partners; 20% on all Chinese imports due to punitive measures he has imposed on China, Mexico, and Canada in connection with his claim that the three countries help to bring the opioid fentanyl into the United States; and, lastly, pre-existing 25% levies on imports from China that were implemented during Trump’s first term in office.
The U.S. president later posted: “President XI and I are going to work closely together to open up China to American Trade. This would be a great WIN for both countries!!!”
It was still unclear how the agreement would be carried out in other details.
A request for clarification and further details was not immediately answered by China’s trade ministry.
Following a chat between Trump and Chinese leader Xi Jinping last week that ended a deadlock that had emerged just weeks after a preliminary agreement agreed in Geneva that had defused their trade war, officials from the two countries convened at a hurried conference in London beginning Monday.
The Trump administration responded with export limits that forbade shipments of semiconductor design software, aircraft, and other commodities to China after the Geneva pact broke down due to China’s ongoing restrictions on exports of vital minerals.
“We have reached a framework to implement the Geneva consensus and the call between the two presidents,”
Lutnick said, adding that both sides will now return to present the framework to their respective presidents for approval.
“And if that is approved, we will then implement the framework,”
he said.
In a separate briefing, China’s Vice Commerce Minister Li Chenggang also said a trade framework had been reached in principle that would be taken back to U.S. and Chinese leaders.
Trump’s fluctuating tariff policies have caused chaos in major ports, agitated international markets, and cost businesses tens of billions of dollars in lost revenue and increased expenses.
The World Bank said that increased tariffs and increased uncertainty were a “significant headwind” for almost all economies, reducing its 2025 global growth prediction by four-tenths of a percentage point to 2.3%.
The U.S.-China accord does little to address long-standing U.S. grievances about China’s state-led, export-driven economic model and the profound disagreements over Trump’s unilateral tariffs, but it may prevent the Geneva pact from collapsing over competing export curbs.
Josh Lipsky stated that the two sides needed to be more explicit about the necessary measures because they left Geneva with essentially divergent opinions about the parameters of that agreement.
“They are back to square one, but that’s much better than square zero,”
Lipsky stated.
Trump’s remarks did not immediately make it apparent how things stood in relation to the schedule for the more comprehensive agreement that was negotiated in Geneva last month.
There, the two parties agreed that a more comprehensive agreement to reduce trade tensions must be negotiated by August 10th, failing which tariff rates will revert from around 30% to 145% on the U.S. side and from 10% to 125% on the Chinese side.
What are the key points still unresolved in the trade negotiations?
Many possible countermeasures and specific trade agreements are still up for debate, particularly with regard to tariff levels and enforcement procedures, despite the fact that certain framework agreements have been achieved.
Reaching a comprehensive agreement is made more difficult by enduring fundamental differences over China’s insistence on upholding its state-centric economic model and the United States’ aspirations for increased market access.
There are questions over the agreement’s longevity and efficacy because neither party has finalized how obligations will be tracked or enforced.
Deeper structural problems like subsidies, technological transfer, and intellectual property rights are still divisive and unlikely to be settled anytime soon.
