U.S. and China Reach Preliminary Trade Agreement to Ease Tensions

The United States and China have reached a preliminary trade agreement following two days of high-level negotiations in Geneva. The talks mark a significant step toward reducing the U.S. trade deficit and calming global markets amid ongoing tariff disputes. 

Geneva Trade Talks Yield Breakthrough 

Held in the Swiss suburb of Cologny, the meetings brought together top economic officials, U.S. Treasury Secretary Scott Bessent, Trade Representative Jamieson Greer, and China’s Vice Premier He Lifeng. Both sides confirmed that substantial progress was made and that further details would be released today May 12, 2025, through a joint statement. 

U.S. Aims to Reduce $1.2 Trillion Trade Deficit 

The talks focused on addressing the $1.2 trillion U.S. trade deficit. Ambassador Greer emphasised that the pace of the agreement reflected fewer differences than expected. The deal follows months of tariff escalation initiated under President Trump’s administration, which declared a national emergency over trade imbalances.

Also read: Trump Proposes 100% Tariff on Foreign-Made Films, Stirring Industry Concerns. 

China Highlights Consensus and Stability 

Chinese Vice Premier He Lifeng confirmed that the two countries reached an “important consensus” and reiterated China’s commitment to safeguarding its core economic interests. Both parties aim to stabilise global markets and prevent further deterioration of economic relations. 

Joint Statement and Future Negotiations Ahead 

Although a trade agreement was reached, no changes to existing tariffs were announced. The U.S. continues to enforce tariffs of up to 145% on Chinese imports, while China maintains retaliatory duties of up to 125% on American products. These trade barriers have significantly disrupted nearly $600 billion in commerce between the two nations. 

A formal announcement with deal specifics is expected from both countries on Monday, May 12, 2025. Officials from both sides indicated that this agreement lays the groundwork for continued dialogue and cooperation on long-term trade issues. 

Conclusion 

The Geneva agreement signals a mutual step toward easing U.S.-China trade tensions. While details are pending, both countries appear committed to continued engagement and economic stabilisation. 

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their research and assessments to form an independent opinion about investment decisions.

Investments in the securities market are subject to market risks, read all the related documents carefully before investing.