China, US Agree to Suspend 24% Tariffs for 90 Days

On May 12, a joint statement from the Geneva trade talks between China and the United States was released. The statement outlined several key measures to be taken by both countries by May 14, 2025. The United States committed to modifying the tariffs imposed on Chinese goods, including those from the mainland, China Hong Kong, and China Macau. Specifically, a 24% tariff would be suspended for the initial 90 days, while a remaining 10% tariff would be retained. Additionally, the U.S. agreed to cancel tariffs imposed under administrative orders from April 8 and April 9, 2025.

In response, China pledged to adjust its tariffs on U.S. goods accordingly. A 24% tariff would also be suspended for the first 90 days, with a remaining 10% tariff to be retained. China further committed to taking necessary measures to suspend or cancel non-tariff retaliatory actions against the U.S. that were implemented starting from April 2, 2025.

Li Daixiao, a former chief economist at a securities firm, described the joint statement as a major positive development. He emphasized its significance in stabilizing both the global and Chinese economies. The declaration is also expected to have a substantial impact on the healthy and stable development of China's stock market. Li Daixiao noted that high-quality blue-chip stocks in China's market already offer attractive valuation metrics. Long-term capital inflows into the market are increasing, and China's stock market is equipped with a comprehensive set of policy tools. The role of funds similar to the stabilization fund in maintaining market stability is evident. Therefore, the healthy and stable development of China's stock market can be anticipated. However, opportunities are limited to the highest quality and lowest-valued blue-chip stocks.