US and Chinese officials have agreed on a framework to de-escalate trade tensions between the world's two biggest economies after a series of tariff disputes.
US commerce secretary Howard Lutnick said the framework put "meat on the bones" of a deal reached last month in Geneva to ease retaliatory tariffs.
The two sides had been seeking to find a way to resolve disputes over mineral and technology exports that shook a fragile truce on trade reached after talks in Geneva last month.
Both sides made the announcement at the end of two days of talks in London that wrapped up late on Tuesday. Top US and Chinese economic officials were pushing for a deal that would ease duelling export controls that threatened to unravel the Geneva accord that cut tariffs back from triple-digit levels.
The officials will now take the framework to their respective presidents for approval.
Mr Lutnick said the deal should result in China easing restrictions on rare earth minerals and magnets. “First, we had to get sort of the negativity out and now we can go forward,” he told reporters after the meeting.
He said both sides would move forward with the framework pending its approval by US president Donald Trump and Chinese leader Xi Jinping. “Once the presidents approve it, we will then seek to implement it,” Mr Lutnick added.
The talks in London followed a phone call between Mr Trump and Mr Xi last week to try to calm the waters after both nations engaged in a dramatic tit-for-tat tariff war earlier this year.
Li Chenggang, a vice minister of commerce and China’s international trade representative, said the two sides had agreed in principle on a framework for implementing the consensus reached on the phone call and at the talks in Geneva.
Mr Lutnick hinted at Washington's willingness to ease the US measures imposed in response to Chinese curbs on exports of rare earths once the supplies of the minerals rose.
China holds a near-monopoly on rare earth magnets, a crucial component in electric vehicle motors, and its decision in April to suspend exports of a wide range of critical minerals and magnets upended global supply chains and sparked alarm in boardrooms and factory floors around the world.
"Also, there were a number of measures the United States of America put on when those rare earths were not coming," Mr Lutnick said. "You should expect those to come off, sort of as president Trump said, in a balanced way."
The two countries announced on 12 May that they had agreed to a 90-day suspension of most of the 100 per cent-plus tariffs imposed on each other in an escalating trade war that had sparked fears of a recession.
Since the Geneva talks, the US and China have exchanged angry words over advanced semiconductors that power artificial intelligence, visas for Chinese students at US universities and rare earth minerals vital to carmakers and other industries.
Customs data published on Monday showed that China's exports to the US plunged 34.5 per cent in May, the sharpest drop since the Covid pandemic.
Wendy Cutler, a former US trade negotiator, said the disputes had frittered away 30 of the 90 days the two sides had to try to resolve their disputes.
“The US and China lost valuable time in restoring their Geneva agreements,” said Ms Cutler, now vice president at the Asia Society Policy Institute. “Now, only sixty days remain to address issues of concern, including unfair trade practices, excess capacity, transshipment and fentanyl.”
China’s commerce minister Wang Wentao was part of the delegation in London headed by vice premier He Lifeng. They met with Mr Lutnick, treasury secretary Scott Bessent and trade representative Jamieson Greer at Lancaster House.
Asian stock markets rose on Wednesday after the agreement was announced.
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