US, China Agree to 90-Day Tariff Reduction, Resume Talks

The United States and China have reached an agreement to temporarily reduce bilateral tariffs, creating a 90-day window for renewed trade negotiations aimed at de-escalating tensions between the two economic superpowers. This agreement was formalized in a joint statement issued in Geneva, where both governments pledged to lower tariffs on each other’s goods for the specified period. This move is seen as a crucial step to restart stalled negotiations and mitigate the broader economic fallout from the ongoing trade dispute.

The United States will reduce its cumulative 145% tariffs on most Chinese imports to 30%, including duties tied to fentanyl-linked goods. This reduction will be achieved by suspending 24 percentage points that were imposed through recent executive orders. Similarly, China will cut its 125% levies on US goods to 10%, eliminating additional tariffs that were introduced since April. This reciprocal reduction in tariffs is a significant step towards easing the trade tensions that have plagued the relationship between the two countries.

The agreement signals a shift in tone, with both sides emphasizing “mutual respect,” “continued communication,” and the goal of a “sustainable, long-term” economic relationship. This newfound emphasis on cooperation and mutual respect is a departure from the previous confrontational approach that has characterized the trade dispute. The statement also confirms that China will remove certain non-tariff countermeasures, such as licensing restrictions and administrative delays, that have hindered US exporters. This removal of non-tariff barriers is expected to facilitate smoother trade relations and encourage greater economic cooperation between the two countries.

Negotiations will resume under a new bilateral framework led by He Lifeng, Vice Premier of China’s State Council, alongside US Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer. Talks may alternate between both countries or take place at neutral venues, providing a flexible and inclusive platform for dialogue. This new framework is designed to foster a more constructive and collaborative approach to trade negotiations, with a focus on finding mutually beneficial solutions to the outstanding issues.

The positive development comes after President Trump said Saturday on Truth Social that US-China talks had made great progress during their meetings in Switzerland. He described the discussions as constructive and friendly, calling the outcome a total reset. This optimistic assessment from the President underscores the significance of the agreement and the potential for a more positive and productive relationship between the two countries in the future. The temporary reduction in tariffs and the resumption of negotiations represent a significant step forward in the ongoing efforts to resolve the trade dispute and promote economic stability and growth.