The U.S. and China on Monday agreed to temporarily suspend most tariffs on each other’s goods in a move that shows a major thawing of trade tensions between the world’s two largest economies, CNBC reported.
The trade agreement means that “reciprocal” tariffs between both countries will be cut from 125% to 10%. The U.S’ 20% duties on Chinese imports relating to fentanyl will remain in place, meaning total tariffs on China stand at 30%.
The breakthrough comes after U.S. and China trade representatives held high-stakes talks in Switzerland over the weekend.
“We had very productive talks and I believe that the venue, here in Lake Geneva, added great equanimity to what was a very positive process,” U.S. Treasury Secretary Scott Bessent said in a news conference.
“We have reached an agreement on a 90-day pause and substantially move down the tariff levels. Both sides on the reciprocal tariffs will move their tariffs down 115%,” Bessent said.
The pause will begin Wednesday. Both China and the U.S. said they will continue discussions on economic and trade policy.
Since returning to the White House in January, U.S. President Donald Trump has launched a flurry of aggressive trade measures that jolted financial markets and watched up recession fears. The duties, which are assigned to narrow the U.S. trade deficit, hit China particularly hard.
The Verge reported: The United States and China have mutually agreed to a 90-day reduction on tariffs implemented in April, while they continue to negotiate a final trade deal.
The deal was hashed out by US and Chinese officials in Geneva over the weekend, and will see the US reducing duties Trump has called “reciprocal tariffs” on Chinese imports from 145 percent to 30 percent, and China lowering tariffs on US goods to 10 percent, down from 125 percent. The reductions ammoniated to 115 percentage points on each side.
In comments to reporters on Monday morning, Trump claimed the US “achieved a total reset with China,” while a statement from China’s Commerce Ministry said it hoped the US would stop its behavior of implementing unilateral tariff hikes.
ArsTechnica reported: The US and China agreed to lower tariffs by 115 percent for 90 days while they continue talks on a longer-term agreement, sending stock soaring on hopes that President Trump’s trade war won’t be as damaging to the two economies as previously feared.
“As part of a deal hammered out in Geneva over the weekend, the US will lower additional tariffs on Chinese goods to 30 percent from 145 percent and China will reduce its duties on US imports to 10 percent from 125 percent. China said it would ‘suspend or cancel’ non-tariff measures taken against the US, the Financial Times reported.
Trump recently appeared to make a deal, while China seemed content to wait for better terms. The White House today called the temporary deal “a historic trade win for the United States” that “demonstrates President Trump’s unparalleled expertise in securing deals that benefit the American people.