The US-China Stockholm Talks See New Progress: The Trade War Enters Another 90-Day "Temporary," with Some Tariff Increases Paused.
Following the economic and trade talks held in Stockholm, Sweden, China and the US issued a joint statement on August 12, announcing that, effective immediately, both sides will suspend the application of some tariffs on each other for another 90 days to implement the consensus reached previously and promote the stable development of bilateral economic and trade relations.
According to the statement, the United States will suspend the 24% tariff on Chinese goods (including Hong Kong and Macao) imposed by Executive Order No. 14257 of April 2, 2025, for 90 days, while retaining the remaining 10% tariff.
China will simultaneously suspend the 24% tariff on US goods as stipulated in Tax Commission Announcement No. 4 of 2025, while also retaining the 10% tariff. China will also suspend or cancel its non-tariff countermeasures against the United States, in accordance with its commitments in the Geneva Joint Declaration.
This tariff adjustment decision is a phased outcome reached within the framework of the Geneva Joint Declaration in May 2025, following two rounds of talks in London in June and Stockholm in July. It aims to create a buffer zone for subsequent negotiations.
In terms of implementation details, China's tariff adjustment will officially take effect at 12:01 PM on August 12th. The US, in turn, maintained the 20% tariff previously imposed due to issues such as banned chemicals, keeping the effective tariff level on Chinese imports at approximately 30%. Both sides emphasized that this decision was made within the framework of the mechanism established by the Geneva Joint Declaration.
Market analysts believe that this tariff suspension will inject a positive signal into global trade and help stabilize Sino-US economic and trade relations. However, differences remain on key issues between the two sides. The Trump administration recently demanded that China stop purchasing Russian oil and threatened to impose "secondary tariffs."
In summary, the next 90-day negotiation window is crucial for the two sides to reach a broader economic and trade agreement. For the global economy, this tariff suspension is expected to ease supply chain pressures; however, global financial markets remain wary of the potential volatility risks associated with subsequent policy changes.
