China-US trade war truce extended
The fragile détente between the two largest economies has been extended as the U.S. expressed optimism that the deal could resolve tensions over rare earths and magnets.
After two days of intense talks held in London, Chinese and U.S. officials have agreed on a framework aimed at easing export restrictions on essential materials, reports The Guardian on June 11. The deal specifically targets rare earth minerals and semiconductors, that underpin everything from electric vehicles to defense systems.
This comes amid an ongoing tariff war, ignited in April when U.S. President Donald Trump slapped Chinese imports with 145 percent tariffs, prompting the latter to retaliate with triple-digit tariffs on American goods.
The tariffs, predictably, plunged China’s exports to the U.S. to 35% in May. The choked global supply of rare earths, which China controls, threatened to halt production in the automotive sector, as permanent magnets are used in everything from windscreen wipers to doors.
The London talks, led by U.S. Treasury Secretary Scott Bessent alongside Commerce Secretary Howard Lutnick and Trade Representative Jamieson Greer, wrapped up after more than 20 hours of negotiations.
Both sides have accused each other of reneging on May’s Geneva deal, which significantly eased retaliatory tariff figures. China reportedly clamped down on rare earth exports while the U.S. maintained semiconductor restrictions.
Lutnick said optimistically that the deal “put the meat on the bones” of the preliminary agreement, while on the chinese side, Vice Commerce Minister Li Chenggang confirmed that the framework would now be submitted to the highest levels of government for approval.
However, others are more skeptical, considering both party’s tumultuous relations: “while the mood music has stayed positive, investors may be wary of the pattern that emerged during the previous U.S.-China trade talks in 2018-19, when apparently constructive in-person meetings seemed to take a step back as the negotiating teams returned to their capitals.”
The Guardian/ Maghrebi
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