U.S. President Donald Trump announced on Thursday that he has agreed to reduce tariffs on China by up to 47% in exchange for Beijing’s commitment to resume purchases of American soybeans, continue exports of rare earth minerals, and crack down on illegal fentanyl trade.
The statement came after a meeting with Chinese President Xi Jinping in Busan, South Korea — the first meeting between the two leaders since 2019. The discussion took place on the sidelines of the Asia-Pacific Economic Cooperation (APEC) Summit and lasted for about two hours.
At the end of the meeting, President Trump shook hands with Xi Jinping, escorted him to his car, and later received a red-carpet farewell ceremony at the airport.
Following the announcement, China’s stock market surged to its highest level in a decade, while the yuan strengthened to its strongest level against the U.S. dollar in a year, as investors grew optimistic that easing trade tensions could help resolve global supply chain disruptions and reduce economic uncertainty.
Stock markets across the world — including Wall Street and Tokyo — also reached record highs in recent days.
President Trump had repeatedly hinted that a trade deal with Xi Jinping was nearing completion. On Sunday, U.S. negotiators confirmed that a framework agreement had been reached under which Washington would refrain from imposing 100% tariffs on Chinese goods, while China would postpone restrictions on the export of rare earth minerals, a sector in which Beijing holds significant global dominance.
However, given both nations’ firm stances on economic and geopolitical issues, questions remain about how long this trade détente will last.
