US-China Trade Deal: Agreement to Reduce Tariffs by 115% for 90 Days

In a significant development in the ongoing trade negotiations between the United States and China, both countries have agreed to a 90-day suspension of a part of their tariffs. This deal, confirmed by US Treasury Secretary Scott Bessent, includes a reciprocal reduction in tariff rates. The decision marks a notable shift in the trade dynamic between the 2 global economic powers.

Details of the Agreement

The trade deal includes a commitment from both nations to substantially reduce their respective tariff rates. The United States will lower its tariffs on Chinese imports from 145% to 30% over the next 90 days. On the other hand, China has agreed to reduce its tariffs on American products from 125% to 10% for the same period.

This move has been described as a positive step towards de-escalating the trade tensions that have been plaguing the global economy. Treasury Secretary Bessent noted that both nations have shown respect for each other during the negotiations, which were marked by productive discussions.

Negotiations and Diplomatic Efforts

The breakthrough in the trade negotiations came after a series of talks held in Switzerland. The discussions took place over a 2-day period and were attended by key representatives, including US Treasury Secretary Bessent and Trade Representative Jamieson Greer. These meetings were critical in addressing the ongoing trade war between the 2 nations, which saw the US imposing high tariffs and China retaliating in kind.

Bessent expressed satisfaction with the productivity of the talks, indicating that significant progress had been made. Although details were initially scarce, it was clear that both sides had worked diligently towards a resolution.

Read More: India Could Be First to Sign Trade Deal with US Amid Tariff Pause, says US Treasury Secretary.

Trump’s Reaction and China’s Caution

President Donald Trump, ever vocal on social media, took to his platform to announce "GREAT PROGRESS" and hailed the agreement as a potential "total reset" in trade relations with China. His positive outlook underscored his belief that the deal marked a turning point in the trade conflict.

However, China’s response remained more measured. A Saturday night editorial released before the second day of talks reiterated Beijing’s stance, emphasising its firm rejection of any proposals that would compromise core principles or undermine global equity. This cautious approach highlighted China's awareness of the complexities involved in the trade negotiations.

Global Impact of the Deal

The reduction in tariffs is expected to have far-reaching effects on global trade. The trade war between the US and China has caused significant disruption to markets worldwide. By reducing tariffs, both countries aim to ease tensions and restore some level of stability to global markets.

While the deal is temporary, the 90-day pause provides a window for further negotiations. It signals a potential shift towards more constructive dialogue between the 2 countries, with hopes that this could lead to a more permanent resolution.

Conclusion

The agreement between the US and China to reduce tariffs for 90 days represents a step forward in their ongoing trade dispute. Although the deal is temporary, it demonstrates a willingness from both sides to engage in constructive negotiations and move towards a more stable trade environment. 

As the situation continues to develop, the world will be watching closely to see how this agreement impacts the global economy and future trade relations between these 2 major powers.

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