The United States and China have reached a preliminary agreement on the framework of a trade deal, which will be discussed and potentially finalized during an upcoming meeting between President Donald Trump and Chinese President Xi Jinping. This development aims to avert further escalation in the trade war between the two economic giants.
The framework was announced following discussions between U.S. Treasury Secretary Scott Bessent and senior Chinese trade officials on the sidelines of the Association of Southeast Asian Nations (Asean) summit in Malaysia. Bessent described the talks as constructive and confirmed that both sides have agreed on key elements to address their respective concerns, setting the stage for the leaders’ meeting.
Key components of the framework include a deferral on China’s tightened controls on rare earth minerals exports, which had prompted threats of additional U.S. tariffs. Bessent stated that China will delay these restrictions for a year while they are re-examined, easing concerns for U.S. manufacturers reliant on these materials for electronics production. Additionally, China has committed to resuming substantial soybean purchases from the U.S., providing relief to American farmers who were affected by previous trade disputes.
Another significant aspect is the resolution of issues surrounding TikTok’s U.S. operations. Bessent indicated that a deal has been agreed upon, with Trump and Xi expected to finalize the transaction. This involves U.S. companies controlling TikTok’s algorithm and Americans holding the majority of board seats, addressing national security concerns while allowing the app to continue operating in the U.S.
The trade tensions escalated recently when Trump threatened to impose a 100% tariff on Chinese goods in response to China’s rare earth export controls. However, with the new framework, Bessent expressed confidence that these tariffs will be averted, signaling a de-escalation in the trade war. Both nations are seeking to avoid further economic damage and stabilize global trade relations.
The upcoming Trump-Xi meeting is scheduled for Thursday in South Korea, where the leaders are expected to review and potentially approve the detailed terms of the trade deal. This face-to-face discussion marks a critical step in resolving longstanding disputes and could lead to a more cooperative economic relationship.
Beyond the U.S.-China negotiations, Trump’s Asia tour has also yielded trade agreements with other Southeast Asian nations, including Malaysia, Cambodia, Thailand, and Vietnam. These deals involve critical minerals, agricultural goods, and expanded market access, reinforcing U.S. engagement in the region and diversifying supply chains away from China.
The framework agreement represents a significant diplomatic achievement amid ongoing tensions, with implications for global markets and international trade policies. If finalized, it could pave the way for reduced tariffs, increased bilateral trade, and enhanced stability in U.S.-China relations, though details remain to be ironed out in the coming days.