{"id":20721,"date":"2025-06-28T02:58:18","date_gmt":"2025-06-28T02:58:18","guid":{"rendered":"https:\/\/www.europesays.com\/us\/20721\/"},"modified":"2025-06-28T02:58:18","modified_gmt":"2025-06-28T02:58:18","slug":"the-new-us-china-trade-agreement-explained","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/us\/20721\/","title":{"rendered":"The new US-China trade agreement, explained"},"content":{"rendered":"

WASHINGTON (AP) \u2014 The United States and China have reached an agreement \u2014 again \u2014 to deescalate<\/a> trade tensions. But details are scarce, and the latest pact leaves major issues between the world\u2019s two biggest economies unresolved.<\/p>\n

President Donald Trump said late Thursday that a deal with China had been signed \u201cthe other day.\u2019’ China\u2019s Commerce Ministry confirmed Friday that some type of arrangement had been reached but offered few details about it.<\/p>\n

Sudden shifts and a lack of clarity have been hallmarks of Trump\u2019s trade policy since he returned to the White House determined to overturn a global trading system that he says is unfair to the United States and its workers. <\/p>\n

He\u2019s been engaged for months in a battle with China that has mostly revealed how much pain the two countries can inflict on each other. And he\u2019s racing against a July 8 deadline to reach deals with other major U.S. trading partners. <\/p>\n

The uncertainty over his dealmaking and the cost of the tariffs, which are paid by U.S. importers and usually passed on to consumers, have raised worries about the outlook<\/a> for the U.S. economy. And although analysts welcomed the apparent easing of tensions with China, they also warned that the issues dividing Washington and Beijing are unlikely to be resolved anytime soon.<\/p>\n

What did the two sides agree to?<\/p>\n

U.S. Treasury Secretary Scott Bessent said Friday that the Chinese had agreed to make it easier for American firms to acquire Chinese magnets and rare earth minerals<\/a> critical for manufacturing and microchip production. Beijing had slowed exports of the materials amid a bitter trade dispute with the Trump administration.<\/p>\n

Without explicitly mentioning U.S. access to rare earths, the Chinese Commerce Ministry said that \u201cChina will, in accordance with the law, review and approve eligible export applications for controlled items. In turn, the United States will lift a series of restrictive measures it had imposed on China.\u2019’ <\/p>\n

The Chinese have complained about U.S. controls on exports of advanced U.S. technology to China. But the ministry statement did not specifically say whether the United States planned to ease or lift those controls.<\/p>\n

In his interview on Fox Business Network\u2019s \u201cMornings with Maria,\u201d Bessent mentioned that the United States had earlier imposed \u201ccountermeasures\u2019\u2019 against China and \u201dhad held back some vital supplies for them.\u2019’ <\/p>\n

\u201cWhat we\u2019re seeing here is a de-escalation under President Trump\u2019s leadership,\u2019’ Bessent said, without spelling out what concessions the United States had made or whether they involved America\u2019s export controls.<\/p>\n

Jeff Moon, a trade official in the Obama administration who now runs the China Moon Strategies consultancy, wondered why Trump hadn\u2019t disclosed details of the agreement two days after it had been reached. <\/p>\n

\u201cSilence regarding the terms suggests that there is less substance to the deal than the Trump Administration implies,\u2033 said Moon, who also served as a diplomat in China.<\/p>\n

Wait. This sounds familiar. How did we get here?<\/p>\n

The agreement that emerged Thursday and Friday builds on a \u201cframework\u2019\u2019 that Trump announced June 11<\/a> after two days of high-level U.S.-China talks in London. Then, he announced, China had agreed to ease restrictions on rare earths. In return, the United States said it would stop seeking to revoke the visas of Chinese students on U.S. college campuses.<\/p>\n

And last month, after another meeting in Geneva, the two countries had agreed to dramatically reduce massive taxes they\u2019d slapped on each other\u2019s products, which had reached as high as 145% against China and 125% against the U.S.<\/p>\n

Those triple-digit tariffs threatened to effectively end trade between the United States and China and caused a frightening sell-off in financial markets. In Geneva, the two countries agreed to back off<\/a> and keep talking: America\u2019s tariffs went back down to a still-high 30% and China\u2019s to 10%. That led to the talks in London earlier this month and to this week\u2019s announcement.<\/p>\n

Where does all this leave U.S.-China economic relations?<\/p>\n

If nothing else, the two countries are trying to ratchet down tensions after demonstrating how much they can hurt each other.<\/p>\n

\u201cThe U.S. and China appear to be easing the chokeholds they had on each other\u2019s economies through export controls on computer chips and rare earth minerals, respectively,\u201d said Eswar Prasad, professor of trade policy at Cornell University. \u201cThis is a positive step but a far cry from signaling prospects of a substantial de-escalation of tariffs and other trade hostilities.\u2019’<\/p>\n

Trump launched a trade war with China in his first term, imposing tariffs on most Chinese goods in a dispute over China\u2019s attempts to supplant U.S. technological supremacy. Trump\u2019s trade team charged that China was unfairly subsidizing its own tech companies, forcing U.S. and other foreign companies to hand over sensitive technology in exchange for access to the Chinese market and even engaging outright theft of trade secrets.<\/p>\n

The squabbling and negotiating of the past few months appear to have done little to resolve Washington\u2019s complaints about unfair Chinese trade practices and America\u2019s massive trade deficit with China, which came to $262 billion last year.<\/p>\n

This week\u2019s agreement \u201cincludes absolutely nothing related to the U.S.\u2019s concerns regarding China\u2019s trade surplus or non-market behavior,\u2019’ said Scott Kennedy of the Center for Strategic and International Studies. \u201dIf the two sides can implement these elements of the ceasefire, then they could begin negotiations on issues which generated the initial escalation in tensions in the first place.\u2019’<\/p>\n

What is happening with Trump\u2019s other tariffs?<\/p>\n

Since returning to the White House in January, Trump has made aggressive use of tariffs. In addition to his levies on China, he has imposed \u201cbaseline\u2019\u2019 10% taxes on imports from every country in the world . And he\u2019s announced even higher taxes \u2014 so-called reciprocal tariffs ranging from 11% to 50% \u2014 on countries with which the United States runs a trade deficit.<\/p>\n

But after financial markets sank on fears of massive disruption to world trade, Trump suspended<\/a> the reciprocal levies for 90 days to give countries a chance to negotiate reductions in their barriers to U.S. exports. That pause lasts until July 8.<\/p>\n

On Friday, Bessent told Fox Business Network that the talks could extend beyond the deadline and be \u201cwrapped up by Labor Day\u2019\u2019 Sept. 1 with 10 to 12 of America\u2019s most important trading partners.<\/p>\n

Trump further played down the July 8 deadline at a White House press conference Friday by noting that negotiations are ongoing but that \u201cwe have 200 countries, you could say 200 countries-plus. You can\u2019t do that.\u201d<\/p>\n

Instead of new trade deals, Trump said his administration would in coming days or weeks send out a letter where \u201cwe\u2019re just gonna tell them what they have to pay to do business in the United States.\u2019’<\/p>\n

Separately, Trump took sudden aim at Canada Friday,<\/a> saying on social media that he\u2019s immediately suspending trade talks with that country over its plan to impose a tax on technology firms next Monday. Trump called Canada\u2019s digital services tax \u201ca direct and blatant attack on our country.\u201d<\/p>\n

The digital services tax will hit companies like Amazon, Google, Meta, Uber and Airbnb with a 3% levy on revenue from Canadian users. It will apply retroactively, leaving U.S. companies with a $2 billion bill due at the end of the month.<\/p>\n

____<\/p>\n

AP Writers Didi Tang and Will Weissert in Washington contributed to this report.<\/p>\n","protected":false},"excerpt":{"rendered":"WASHINGTON (AP) \u2014 The United States and China have reached an agreement \u2014 again \u2014 to deescalate trade…\n","protected":false},"author":3,"featured_media":19390,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4,3],"tags":[17053,7060,6229,13214,11744,64,74,13212,69,12042,86,59,13790,19263,7062,50,18244,19262,16618,14945,67,132,68],"class_list":{"0":"post-20721","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-united-states","8":"category-us","9":"tag-airbnb","10":"tag-alphabet","11":"tag-amazon-com","12":"tag-asia-pacific","13":"tag-barack-obama","14":"tag-business","15":"tag-china","16":"tag-china-government","17":"tag-donald-trump","18":"tag-economic-policy","19":"tag-government-policy","20":"tag-inc","21":"tag-international-trade","22":"tag-jeff-moon","23":"tag-meta-platforms","24":"tag-news","25":"tag-scott-bessent","26":"tag-scott-kennedy","27":"tag-tariffs-and-global-trade","28":"tag-u-s-department-of-commerce","29":"tag-united-states","30":"tag-unitedstates","31":"tag-us"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@us\/114758753205233173","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/20721","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/comments?post=20721"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/20721\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media\/19390"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media?parent=20721"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/categories?post=20721"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/tags?post=20721"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}