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US commerce secretary Howard Lutnick said American and Chinese negotiators had agreed a framework deal to revive a truce of their trade war after marathon negotiations in London.
The breakthrough restores the trade war ceasefire reached in Geneva last month that had faltered due to differences over Chinese rare earth exports and US export controls.
The US team would return to Washington to present the deal to President Donald Trump, Lutnick said at the top of two days of talks in London. He didn’t provide any details concerning the framework.
Li Chenggang, considered one of the Chinese trade officials, said he hoped the negotiations, which he described as skilled and candid, would create more trust between the 2 nations, in response to Reuters. Li said the Chinese team would also present the agreement to President Xi Jinping.
Within the deal that US and Chinese negotiators reached in Geneva last month each countries agreed to slash their respective tariffs on the opposite by 115 percentage points, and provided a 90-day window to resolve the US-China trade war. However the ceasefire got here under pressure after Washington accused Beijing of reneging on an agreement to hurry up the export of rare earths and China criticised recent US export controls.
Lutnick and US trade representative Jamieson Greer joined Treasury secretary Scott Bessent for the talks in London with the Chinese delegation led by He Lifeng, a vice-premier answerable for the economy. Earlier on Tuesday, Lutnick said the talks could stretch right into a third day.
Bessent left London before the talks ended to return to Washington ahead of a previously scheduled plan to testify before Congress on Wednesday.
The talks were held in central London within the government-owned mansion of Lancaster House, a brief walk from Buckingham Palace. The historic venue, home also to the UK government’s 39,000-bottle wine cellar, was provided by the British government as neutral ground for the talks between the 2 economic superpowers.
The talks followed a call last week between Trump and Xi.
The London meeting marked the primary face-to-face talks between He and Bessent since a 90-day truce was brokered in Geneva.
The high-stakes negotiations were launched to make sure two difficult issues — Chinese exports of rare earths to the US and American technology export controls on China — didn’t derail the broader talks.
Ahead of the primary round of talks in Geneva, Bessent warned the high tariffs both sides had imposed on the opposite amounted to an embargo on bilateral trade. Underscoring the risks, Chinese exports to the US fell more steeply in May, 12 months on 12 months, than at any point for the reason that pandemic in 2020.
While the US has accused China of not honouring its pledge from Geneva to ease restrictions on rare earths exports, Beijing has increased pressure on Washington to eliminate technology-related export controls. It was also offended that the US announced recent restrictions after the Geneva meeting.
The US has accused China of foot-dragging over approvals of shipments of rare earths, that are critical to the defence, automobile and tech industries. The slow pace of approvals has affected manufacturing supply chains within the US and Europe.
Beijing has in turn accused Washington of “seriously violating” the Geneva agreement by issuing recent warnings on using Huawei chips globally, halting sales of chip design software to Chinese corporations and cancelling visas for college students from the country.
On Monday, a senior White House official indicated Trump could ease restrictions on selling chips to China if Beijing agreed to hurry up the export of rare earths.
That will amount to a big change of policy from Joe Biden’s administration, which implemented what it called a “small yard, high fence” approach designed to limit Beijing’s ability to acquire US technology that might be used to assist China’s military.
