Trade negotiations between the United States and China are in a fragile truce, with ongoing tensions and mutual accusations of violating agreements. Here is a summary of the topic:
Background:
* The trade war between the United States and China has resurfaced following the return of President Donald Trump to the White House, where he imposed escalating tariffs on Chinese goods.
* China responded by imposing similar tariffs, leading to a significant decline in trade between the two countries and turmoil in global markets.
Latest developments (June 2025):
* Temporary truce and tariff reduction: In mid-May, both sides reached a "truce" for 90 days in Geneva, during which tariffs were significantly reduced:
* The United States reduced its tariffs on Chinese products from 145% to 30%.
* China reduced its tariffs on American imports from 125% to 10%.
* China also promised to lift restrictions on rare earth metal exports.
* Mutual accusations of violating the truce:
* The United States accuses China: Following the agreement, the United States accused China of failing to fulfill its promises, especially regarding lifting restrictions on rare earth metal exports.
* China accuses the United States: China accused the United States of violating the agreement by halting the sale of computer chip design programs to Chinese companies, warning against the use of Huawei chips, and canceling Chinese student visas.
* A new round of talks in London: On June 9, 2025, senior officials from both countries began a new round of talks in London, following a phone call between President Trump and President Xi Jinping described as "very good."
* Key issues for the talks: The key issues in the current talks include:
* China's exports of rare earth metals (which are critical for many technology industries).
* China's access to American products and technology, including semiconductors and artificial intelligence.
* Restrictions on Chinese student visas.
Overall situation:
* Despite temporarily lowering tariffs, their levels remain historically high.
* Deep structural disagreements still exist between the two countries on issues such as intellectual property protection, forced technology transfer, and unfair trade practices.
* Uncertainty remains the dominant feature of trade relations between the United States and China, affecting businesses and global investors.