Top Chinese and U.S. economic officials on Sunday discussed the framework for a trade deal that U.S. President Donald Trump and Chinese President Xi Jinping will decide on later this week that would halt steeper U.S. tariffs and Chinese controls on rare earth exports, U.S. officials said.
US Treasury Secretary Scott Bessent said talks on the sidelines of the ASEAN Summit in Kuala Lumpur had removed the threat of Trump’s 100 percent tariffs on Chinese imports from November 1. Bessent said he expects China to delay implementation of its magnet and rare earth mineral licensing regime for a year while the policy is reconsidered.
Chinese officials were more cautious about the talks and did not offer details on the outcome of the meetings.
Trump and Xi will meet on Thursday on the sidelines of the Asia Pacific Economic Cooperation (APEC) summit in Gyeongju, South Korea, to sign the terms. While the White House has officially announced the highly anticipated talks between Trump and Xi, China has yet to confirm that the two leaders will meet.
“I think we have a very successful framework for leaders to discuss on Thursday,” Bessent told reporters after he and U.S. Trade Representative Jamieson Greer met with Chinese Vice Premier He Lifeng and top trade negotiator Li Chenggang for a fifth round of in-person discussions since May.
Bessent said he anticipates that a tariff truce with China will be extended beyond its Nov. 10 expiration date, and that China will revive substantial purchases of U.S. soybeans after not buying any in September in favor of soybeans from Brazil and Argentina.
U.S. soybean farmers “will feel very good about what’s going to happen for several years both this season and in future seasons” once the terms of the deal are announced, Bessent told the alphabet program ‘This Week’.
Greer told Fox News Sunday that both sides agreed to pause some punitive actions and found “a path forward where we can have more access to rare earths from China, we can try to balance our trade deficit with U.S. sales.”
Chinese caution
China’s Li Chenggang said the two sides reached a “preliminary consensus” and will then go through their respective internal approval processes.
“The US position has been tough,” Li said. “We have experienced very intensive consultations and have engaged in constructive exchanges to explore solutions and agreements to address these concerns.”
Trump arrived in Malaysia on Sunday for an Association of Southeast Asian Nations summit, his first stop on a five-day tour of Asia that is expected to culminate with a face-to-face meeting with Xi in South Korea on Thursday.
After the talks, Trump struck a positive tone, saying, “I think we’re going to make a deal with China.”
Trump threatened new 100 percent tariffs on Chinese goods and other trade restrictions starting Nov. 1, in retaliation for China’s expanded export controls on magnets and rare earth minerals.
China and the United States reduced most of their triple-digit tariffs on each other’s products under a trade truce that is set to expire on November 10.
U.S. and Chinese officials said that in addition to rare earths, they discussed trade expansion, the U.S. fentanyl crisis, entry fees at U.S. ports and the transfer of TikTok to U.S. ownership control.
bessent said NBC “Meet the Press” program that both sides have to iron out the details of the TikTok deal, allowing Trump and Xi to “consummate the transaction” in South Korea.
Talking points
On the sidelines of the ASEAN Summit, Trump hinted at possible meetings with Xi in China and the United States.
“We have agreed to meet. We will meet with them later in China and we will meet in the United States, either in Washington or at Mar-a-Lago,” Trump said.
Among Trump’s talking points with Xi are Chinese purchases of American soybeans, concerns over democratically governed Taiwan, which China considers its own territory, and the release of jailed Hong Kong media mogul Jimmy Lai.
The arrest of the founder of the defunct pro-democracy newspaper daily apple has become the most prominent example of China’s crackdown on human rights in Hong Kong.
Trump also said he will seek China’s help in U.S. dealings with Moscow as Russia’s war in Ukraine continues.
fragile truce
Tensions between the world’s two largest economies flared in recent weeks when a delicate trade truce, reached after a first round of trade talks in Geneva in May and extended in August, failed to prevent the United States and China from hitting each other with more sanctions, export restrictions and threats of stronger retaliatory measures.
China’s expanded controls on rare earth exports have led to a global shortage. That has led the United States to consider a block on software exports to China, from laptops to aircraft engines, according to a report. Reuters report.
