Topline
President Donald Trump on Wednesday said the U.S. reached a trade agreement with China, including a reprieve of restrictions China had imposed on rare earth minerals and magnets crucial to operations in industries from defense to auto.
The trade agreement includes full magnets and “any necessary rare earths” from China as the U.S. … More
Getty ImagesKey Facts
Trump, in a post on Truth Social, said a deal was “done” between the U.S. and China, which will supply “any necessary rare earths” and magnets as the U.S. makes concessions on allowing Chinese students to attend American universities.
China had imposed limitations on exports of rare earth minerals and magnets crucial to development of advanced defense technology, cars, robotics and more, amid the months-long tit-for-tat trade war with the U.S.
Though the details of the deal were unclear, some analysts predicted China would continue to have the upper-hand after its rare earth restrictions prompted Ford Motor and some other U.S. companies to slow down production: “China’s going to want to maintain leverage,” Gracelin Baskaran, director of the critical minerals security program at the Center for Strategic and International Studies in Washington, told the Wall Street Journal.
Trump also said the U.S. would impose 55% tariffs on Chinese goods, while China would impose a 10% tax on U.S. imports.
Trump said a deal is subject to final approval from him and Chinese President Xi Jinping.
Chinese state media said earlier Wednesday Beijing had reached a “framework” for an agreement with the U.S. during talks in London.
Crucial Quote
Commerce Secretary Howard Lutnick described the agreement as a “handshake for a framework” late Tuesday, indicating the terms were in flux: “Once that’s done, we will be back on the phone together and we will begin to implement this agreement,” he said.
Key Background
Trump and Xi spoke in a 90-minute phone call Thursday, indicating the two sides were nearing a final agreement, weeks after the two sides reached an initial deal in Geneva last month to pause tariffs that effectively cut off trade between the two superpowers for 90 days. U.S. officials expressed concerns, however, that Beijing continued to impose export restrictions on rare earth minerals and magnets despite the truce, prompting the U.S. to limit semiconductor exports from companies such as Nvidia.
Further Reading
Trump Says Call With Xi Was Focused On Trade, ‘Very Positive’ (Forbes)
Trump’s Steel Tariff Hike Takes Effect—Here Are The 22 Times He’s Changed His Mind On Tariffs (Forbes)
Trump Accuses China Of Violating U.S. Trade Agreement (Forbes)
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