The US and China on Monday agreed to suspend most of their reciprocal tariffs for 90 days, in a temporary pause in their trade war to hold more negotiations on trade disputes, reported CNN.
The deal came after two days of talks in Geneva, Switzerland, led by the US Treasury Secretary, Scott Bessent, and Trade Representative, Jamieson Greer, as well as the Chinese Premier, He Lifeng.
90-Day Tariff Pause
In a joint statement, the governments of the US and China announced that they agreed on a 110% tariff reduction for 90 days. Thus, the US will reduce tariffs on Chinese goods from 145% to 30%, while China will lower duties on US goods from 125% to 10%. The tariff reduction will take effect from Wednesday, May 14, 2025.
The statement also said the agreement came in recognition of “the importance of a sustainable, long-term, and mutually beneficial economic and trade relationship.” Both parties also agreed to “establish a mechanism to continue discussions about economic and trade relations.”
More Consultations
During a press conference in Geneva, Bessent said that the agreement aims to pave the way for a more balanced trade. “The consensus from both delegations this weekend is neither side wants a decoupling. And what had occurred with these very high tariff … was an embargo, the equivalent of an embargo. And neither side wants that. We do want trade. We want more balanced trade. And I think that both sides are committed to achieving that,” he said.
Similarly, a spokesperson for the Chinese Commerce Ministry hailed the agreement as “an important step by both sides to resolve differences through equal-footing dialogue and consultation, laying the groundwork and creating conditions for further bridging gaps and deepening cooperation.”
US-China Trade War
On April 2, Trump sparked a trade war by announcing stiff tariffs on all imports to the US. Trump’s move sparked fear across the world of an economic recession and higher inflation. As a result, Trump later suspended most of the tariffs for 90 days, with many countries trying to negotiate with the US.
China took the hardest blow, which resulted in a tit-for-tat tariff spree between both countries, with the US tariffs against China reaching 145%, while Beijing’s tariffs against Washington stood at 125%.
UK Deal
In response to Trump’s tariffs, many countries have tried to negotiate with Washington, pursuing more balanced trade deals with the US. In the light of this, the UK has become the first country to strike a trade deal with the US after Trump’s tariffs.
On Thursday, Trump and UK Prime Minister, Keir Starmer, announced a “breakthrough” trade agreement, which leaves a 10% tariff rate on British imports in place, reduces tariffs on imported cars to the US from 27.5% to 10% on a quota of 100,000 vehicles, and cuts the import taxes on steel and aluminum from 25% to zero.
