US and China agree ‘framework’ for trade deal ahead of Xi-Trump meeting | Donald Trump
The United States and China agreed on a framework for a trade deal just days before Donald Trump and Chinese President Xi Jinping met.
Treasury secretary Scott Bessent said the agreement, made during the Association of Southeast Asian Nations (Asean) summit in Malaysia on Sunday, would eliminate the threat of a 100% tariff on Chinese imports starting Nov. 1 and would include a “final agreement” on the sale of TikTok in the United States.
Trump arrived in Malaysia on Sunday for the summit, the first stop of his five-day Asian tour that is expected to culminate in a face-to-face meeting with Xi in South Korea on Thursday.
After the talks, the US president struck a positive tone: “I think we will make a deal with China.”
Bessent said China will “postpone” export controls on minerals used in warplanes, smartphones and electric vehicles for a year as part of the ceasefire.
China’s chief trade negotiator Li Chenggang said both sides had reached a “preliminary consensus” and would go through their own internal approval processes from now on.
“The US’s stance was tough,” Li said. “We have had very intensive consultations and constructive exchanges to explore solutions and regulations to address these concerns.”
There were also hopes for a ceasefire between the United States and Brazil following President Luiz Inácio Lula da Silva’s meeting with Trump in Malaysia, which he described as “positive”. The official said their respective teams would “immediately” begin discussing tariffs and other issues.
A deal between the US and China reduces the likelihood of an all-out global trade war threatening auto production in Europe and the UK.
This follows months of escalating trade tensions between the two economic superpowers, triggered by Trump’s “liberation day” tariff announcement outside the White House in April.
With just days left before current tariff ceasefires expire, Xi has shown that he has no intention of bowing to Trump’s threat of 100% tariffs.
Instead, he turned the screws to the United States by imposing controls on exports of rare earth minerals, including magnets, a critical element used for car electronic windows and trunk openings.
Trump accused Beijing, which controls 60 percent of global production and 90 percent of rare earth refineries, of being “very hostile” and trying to hold the world “captive.”
Beijing also hit the US agricultural sector hard by halting purchases of US soybeans. China is the US’s biggest soyabean customer, importing half of its $24bn (£18bn) exports in 2024.
“I think we have a very successful framework that the leaders will discuss on Thursday,” Bessent told reporters after he and U.S. trade representative Jamieson Greer met with Chinese vice premier He Lifeng and Li for their fifth round of face-to-face talks since May.
Bessent said he anticipates the tariff truce with China will be extended beyond its Nov. 1 expiration date and that China will revive significant purchases of U.S. soybeans in September after buying no soybeans and instead sourcing the crop from Brazil and Argentina.
Bessent told ABC that U.S. soybean farmers “will feel very good about what’s going on both this season and over the next few years” once the terms of the deal are announced.
Greer said both sides agreed to halt some punitive actions and “found a path forward where we can have greater access to rare earths from China and try to offset our trade deficit with sales from the United States.”
Tensions between Brazil and the United States have increased since August, when Trump increased tariffs on imports of most Brazilian goods to 50% from 10% in August.
“We agreed that our teams will meet immediately to advance the search for solutions to the tariffs and sanctions against Brazilian officials,” Lula said in a statement on his social media account after the meeting.
Trump linked the tariff move with what he called the “witch hunt” against the South American country’s former president, Jair Bolsonaro.
