In a significant development during a meeting in Busan, South Korea, U.S. President Donald Trump and Chinese President Xi Jinping reached several agreements that indicate a potential thaw in the ongoing trade tensions between the two nations. Among the key concessions from the U.S. side is a 10% reduction in tariffs related to China’s fentanyl exports, which had been a significant point of contention. Additionally, the U.S. has agreed to eliminate a proposed 100% tariff that was set to take effect on November 1 and has extended a pause on reciprocal tariffs for another year, according to statements from China’s Ministry of Commerce.
On the Chinese side, President Xi’s administration responded by agreeing to a one-year extension of the halt on export controls of rare earth minerals—resources that hold strategic importance and are crucial for various technologies—including those impacted by Trump’s initial tariffs. However, this concession appears to be laden with caveats, as Trump acknowledged that this agreement would need to be revisited after the year concludes.
Experts have noted that Xi’s maneuvering has effectively turned the tables on the Trump administration, suggesting that the concessions from the U.S. reflect a strategic victory for China. Jonathan Czin of the Brookings Institution likened the situation to a game of “whack-a-mole,” alleging that China has adeptly managed to respond to U.S. policies while maintaining its economic interests. Commentator Nicholas Kristof pointed out that while the meeting may superficially resemble a restoration of previous trade norms, it may signify a retreat by the U.S., as Trump’s tariffs initially prompted China to leverage its dominance over rare earths.
The broader implications of the meeting include concerns over the U.S.’s lack of comparable leverage against China, with Joe Mazur from Trivium China asserting that Beijing’s approach—striking back rather than initiating conflict—has proven effective. Craig Singleton, a senior fellow at the Foundation for Defense of Democracies, characterized the talks as yielding “breathing room” rather than a monumental breakthrough.
Despite Trump branding the meeting as “amazing” and claiming a score of “12” out of 10, the mood from the Chinese side was more measured. Their official recap emphasized the need for future discussions that adhere to principles of equality and mutual respect.
As for specific details of the agreements, they remain somewhat nebulous. Proposals include increased Chinese purchases of U.S. soybeans, oil, and gas, discussions about a potential sale of TikTok, and policies regarding semiconductor chips. Trump suggested that decisions on chip sales would largely rest with U.S. companies, particularly Nvidia, while China indicated a willingness to enhance agricultural trade but sidestepped calls for reduced oil purchases from Russia.
Overall, while the meeting may stave off immediate escalation in trade hostilities, experts assert that the outcomes reflect a recalibration of power dynamics favoring China, suggesting that future negotiations will be critical in determining the long-term trajectory of U.S.-China relations.
