US and China Reach Trade Framework Agreement Ahead of Summit
The United States and China have agreed to a framework for a trade deal, averting the imposition of further tariffs and addressing concerns over technology and critical mineral exports just days before a planned meeting between President Donald Trump and Chinese President Xi Jinping.
The agreement, reached on the sidelines of the Association of Southeast Asian Nations (ASEAN) summit in Malaysia yesterday, includes a commitment from China to “delay” export controls on minerals crucial for industries like fighter jets, smartphones, and electric vehicles for one year. Treasury Secretary Scott Bessent also stated the framework includes “a final deal” on the sale of TikTok in the US. This development eases fears of a wider economic conflict that could have significantly impacted global supply chains.
President Trump, currently on a five-day Asia tour, expressed optimism about the prospects for a comprehensive deal, stating, “I think we’re going to have a deal with China.” China’s top trade negotiator, Li Chenggang, confirmed a “preliminary consensus” had been reached, noting the need for internal approval processes. The US has been seeking to reduce its trade deficit with China and gain greater access to key resources; you can find more information about the US-China trade relationship at the Council on Foreign Relations.
In a separate development, the US and Brazil also signaled a potential truce after a “positive” meeting between Trump and President Luiz Inácio Lula da Silva. Teams from both countries will “immediately” begin discussions regarding tariffs and other outstanding issues. Bessent anticipates an extension of the current tariff truce beyond November 1st and a resumption of substantial US soya bean purchases by China, which had shifted to sourcing from Brazil and Argentina. The US Department of Agriculture provides detailed data on agricultural trade.
Officials indicated that further details of the agreement will be discussed during the upcoming meeting between Trump and Xi in South Korea on Thursday.
