Trump confirms US-China trade deal, China verifies framework details
China confirmed a framework was agreed. The deal touches on rare earth exports, fentanyl regulations, and tariff rollbacks, while trade talks with India are expected soon
Bangkok: The US and China have signed an agreement on trade, President Donald Trump said, adding he expects to soon have a deal with India. Commerce Secretary Howard Lutnick told Bloomberg TV that the deal was signed earlier this week. Neither Lutnick nor Trump provided any details about the agreement.
“We just signed with China the other day,” Trump said late Thursday. Lutnick said the deal was “signed and sealed” two days earlier. It was unclear if the latest agreement was different from the one Trump announced two weeks earlier, which he said would make it easier for American industries to obtain much-needed needed magnets and rare earth minerals.
That pact cleared the way for the trade talks to continue, while the US agreed to stop trying to revoke visas of Chinese nationals on US college campuses. China‘s Commerce Ministry said Friday that the two sides had “further confirmed the details of the framework”.
But its statement did not explicitly mention US access to rare earths, minerals used in high-tech applications that have been at the centre of the negotiations. China will approve the export applications of controlled items that meet the conditions in accordance with the law. The United States will cancel a series of restrictive measures taken against China accordingly. It is hoped that the United States and China will meet each other halfway,” it said.
The agreement follows initial talks in Geneva in early May that led both sides to postpone massive tariff hikes that were threatening to freeze much trade between the two countries. Later talks in London set a framework for negotiations, and the deal mentioned by Trump appeared to formalise that agreement.“The president likes to close these deals himself. He’s the dealmaker. We’re going to have deal after deal,” Lutnick said.
China has not announced any new agreements, but it announced earlier this week that it was speeding up approvals of exports of rare earths, materials used in high-tech products such as electric vehicles. Beijing’s limits on exports of rare earths have been a key point of contention.
The Chinese Commerce Ministry said Thursday that Beijing was accelerating the review of export license applications for rare earths and had approved “a certain number of compliant applications”.
Export controls of the minerals apparently eclipsed tariffs in the latest round of trade negotiations between Beijing and Washington after China imposed permitting requirements on seven rare earth elements in April, threatening to disrupt production of cars, robots, wind turbines and other high-tech products in the US and around the world.
China also has taken steps recently on the fentanyl issue, announcing last week that it would designate two more substances as precursor chemicals for fentanyl, making them subject to production, transport and export regulations.
Trump has demanded that Beijing do more to stop the flow of such precursor ingredients to Mexican drug cartels, which use them to make fentanyl for sale in the US.
He imposed 20 per cent tariffs on Chinese imports over the fentanyl issue, the biggest part of the current 30 per cent across-the-board taxes on Chinese goods. The agreement struck in May in Geneva called for both sides to scale back punitive tariff hikes imposed as Trump escalated his trade war and sharply raised import duties. Some higher tariffs, such as those imposed by Washington related to the trade in fentanyl and duties on aluminium and steel, remain in place.
The rapidly shifting policies are taking a toll on the world’s two largest economies. The US economy contracted at a 0.5 per cent annual pace from January through March, partly because imports surged as companies and households rushed to buy foreign goods before Trump could impose tariffs on them.
In China, factory profits declined by more than 9 per cent from a year earlier in May, with automakers accounting for a significant share of that drop. They fell by more than 1 per cent year-on-year in January-May.
Trump and other US officials have indicated they expect to reach trade deals with many other countries, including India.
“We’re going to have deal after deal after deal,” Lutnick said.
