The United States and China have agreed in principle to a framework aimed at easing trade tensions, following two days of high-level negotiations in London.
The announcement signals cautious optimism in the ongoing standoff between the world’s two largest economies, particularly over access to rare earth minerals and high-tech components.
US Commerce Secretary Howard Lutnick confirmed the development on Monday, stating that the framework—described as a path toward implementing the “Geneva consensus”—would now be taken to Presidents Donald Trumpand Xi Jinping for final approval.
“We have reached a framework to implement the Geneva consensus,” Lutnick told reporters. “Once the presidents approve it, we will then seek to implement it.”
His Chinese counterpart, Vice Commerce Minister Li Chenggang, echoed the sentiment, adding that the deal builds on the June 5th phone call between Trump and Xi and earlier agreements struck in Switzerland last month.
The talks were dominated by disputes over rare earth minerals—critical materials used in manufacturing smartphones, electric vehicles, and military technologies. China is the world’s top producer and exporter of these minerals, and recent slowdowns in export approvals have sparked alarm in Washington.
The US has accused Beijing of dragging its feet on shipments of rare earth metals and magnets, which were meant to resume after both countries agreed to a temporary tariff truce in May. That truce, dubbed a “total reset” by President Trump, reduced US tariffs on Chinese goods to 30% and lowered Chinese levies on US imports to 10%, while also promising the removal of key non-tariff barriers.
However, tensions flared again as each side accused the other of breaching the agreement. The US cited China’s failure to release rare earth shipments, while China pointed to new restrictions on semiconductor sales, AI-linked technologies, and even visa cancellations for Chinese students.
The tentative deal now marks a significant, if fragile, breakthrough in the dispute. Both governments have pledged to de-escalate by resolving bottlenecks in trade and removing barriers to the movement of strategic materials and technologies.
Ahead of the talks, China’s Ministry of Commerce confirmed it had approved new rare earth export licences, though it offered no specifics. Meanwhile, Trump announced on Friday that Xi had agreed to restart rare earth trade, a gesture welcomed by American manufacturers and defense contractors.
Despite the positive tone, deep-rooted issues remain. US Trade Representative Jamieson Greer said earlier that China had not followed through on its pledge to remove restrictions on rare earth magnets—used in everything from wind turbines to guided missiles.
Beijing, in turn, criticized Washington for blocking chip design software and pressuring allies to avoid using Chinese technology like Huawei semiconductors.
Both countries are operating under a 90-day deadline set in May to reach a comprehensive trade deal. If successful, the agreement could reshape global supply chains and restore a measure of predictability to a market long rattled by protectionism and geopolitical rivalry.
For now, attention turns to Trump and Xi, whose endorsement is needed to move the framework from principle to policy.
Chioma Kalu
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