In a significant development aimed at cooling trade tensions between the United States and China, the White House has confirmed that China will suspend additional export controls on rare earth metals and halt investigations focusing on U.S. companies in the semiconductor supply chain. This announcement comes following a high-stakes trade agreement reached earlier in the week between President Donald Trump and Chinese President Xi Jinping.
Details of the pact were outlined in a fact sheet released by the White House, highlighting measures to ease the escalating trade conflict between the two economic superpowers. Under the new agreement, China will issue general licenses for the export of rare earth elements such as gallium, germanium, antimony, and graphite, which will benefit U.S. end users and their international suppliers. This represents a significant rollback of export controls initially imposed in October 2022 and April 2025.
In a reciprocal move, the United States will pause some existing tariffs on Chinese imports for an additional year, notably halting plans to implement a 100% tariff on Chinese goods that had been proposed for November. The White House also announced an extension on certain tariff exclusions under Section 301, pushing the expiration date further into 2026.
The Chinese Embassy in Washington has not yet responded to requests for comment regarding the agreement. Analysts view the summit between Trump and Xi, marking their first in-person meeting of Trump’s second term, as a crucial step in stabilizing relations after a period of heightened tension that impacted global markets and raised fears of an economic downturn.
Key components of the agreement include China’s decision to pause its sweeping controls on rare-earth magnets, which it had threatened to impose as leverage against U.S. trade. In exchange, the U.S. agreed to scale back its restrictions on Chinese firms. Additionally, the U.S. will cut a fentanyl-related tariff from 20% to 10%, while China committed to resuming purchases of American agricultural products, including at least 12 million metric tons of soybeans this season, with a minimum of 25 million metric tons annually for the following three years. Trump has indicated that a continued crackdown by China on fentanyl exports could lead to the elimination of the remaining 10% tariff.
The agreement also signals a positive development for U.S. chipmakers, as it includes provisions allowing the Chinese facilities of Dutch chipmaker Nexperia BV to resume shipments, alleviating previous concerns that threatened auto production amid the escalating trade dispute.
Despite these advancements, experts warn that while the agreement may provide temporary relief, it does not fully address the complex issues central to U.S.-China relations. Tensions over geopolitical flashpoints such as Taiwan and Russia’s ongoing war in Ukraine remain unresolved, and both nations continue to engage in a broader trade struggle.
Additionally, Trump has endorsed a plan for an American consortium to acquire the U.S. operations of ByteDance Ltd.’s TikTok app, although Beijing’s formal approval of the sale is still pending. The President also mentioned prospective cooperation on energy, indicating that China had agreed to purchase oil and gas from Alaska.
This trade agreement is seen as a crucial step towards mitigating immediate tensions but leaves open many unresolved issues that could resurface in future negotiations.
