China has announced a “basic consensus” on a trade deal with the United States. This development comes just before US President Donald Trump is set to meet Chinese President Xi Jinping.
The announcement followed two days of discussions between Chinese Vice Premier He Lifeng and the US delegation, led by Treasury Secretary Scott Bessent, at the ASEAN summit in Kuala Lumpur.
The talks, described as “candid, in-depth, and constructive” by Lifeng, covered various issues such as tariffs, export controls, agricultural trade, and cooperation on fentanyl-related enforcement. Lifeng emphasised that economic relations between Beijing and Washington are based on “mutual benefit and win-win results,” stating that both nations benefit from cooperation but suffer from confrontation.
Focus on Preventing Trade Tensions
According to CNN, both countries are now concentrating on preventing any escalation in their trade tensions. These tensions had intensified earlier this month due to Trump’s tariff threats. Initially, these tariffs were scheduled to take effect on November 1. However, following the talks, US Treasury Secretary Scott Bessent mentioned that Trump’s threat of imposing an additional 100% tariff on Chinese goods “has gone away.”
Bessent told CBS News that the proposed tariffs were part of Trump’s response to China’s expanded export controls on rare earth materials. These materials are crucial for global industries like electronics and defence. He stated, “We had a very good two-day meeting. I would believe that the – so it would be an extra 100% from where we are now, and I believe that that is effectively off the table.”
Trump’s Optimism for a Deal
President Trump arrived in Malaysia for the ASEAN summit as part of his five-day Asia tour. This tour will conclude with a meeting with Xi Jinping in South Korea on October 30. Speaking to reporters, Trump expressed optimism about reaching an agreement with China: “I think we’re going to have a deal with China.”
The recent talks come amid growing concerns over China’s new export controls on rare earth magnets and minerals. These controls have caused shortages worldwide. Despite previous truces reached in Geneva in May and extended in August, both countries have continued imposing sanctions and restrictions on each other’s industries.
The discussions between China and the US mark a significant step towards easing trade tensions between the two nations. As both sides work towards preventing further escalation, there is hope for improved economic relations moving forward.