Trump and Xi strike one-year trade truce, cooling US-China economic tensions

U.S. President Donald Trump and Chinese President Xi Jinping have reached a one-year truce in their countries’ prolonged trade war, offering a temporary reprieve in one of the world’s most consequential economic rivalries.

The agreement, announced Thursday on the sidelines of the Asia-Pacific Economic Cooperation (APEC) summit in Gyeongju, marks the first in-person meeting between the two leaders since 2019. While the deal halts a new round of punitive measures, it stops short of dismantling many of the existing barriers that have strained global supply chains and markets.

Under the terms of the accord, China will defer planned export controls on rare earth minerals, critical materials for electronics and defense technologies. While Washington will withdraw a threatened 100 percent tariff on Chinese imports.

Trump also said he would halve a 20 percent tariff on Chinese goods linked to fentanyl production to 10 percent after Xi pledged to intensify efforts to curb the flow of the synthetic opioid into the United States.

“I believe he is going to work very hard to stop the death that is coming in,” Trump told reporters aboard Air Force One after departing South Korea.

The U.S. president described the nearly two-hour meeting as “amazing,” saying that the issue of rare earths had been “settled” and would be reviewed annually.

“There’s no roadblock at all on rare earths  that will hopefully disappear from our vocabulary for a little while,” Trump said.

Xi, in remarks reported by China’s state-run Xinhua News Agency, said both sides had reached a “consensus to address problems” and should “promptly refine and finalise follow-up actions” to ensure “tangible results” that benefit both nations and the global economy.

China’s Ministry of Commerce later confirmed key aspects of the deal, including the suspension of export controls and an agreement by Washington to delay expanding technology-related restrictions on Chinese subsidiaries. Both nations will also pause reciprocal port fees imposed amid the trade dispute.

Trump said China had additionally agreed to purchase “tremendous amounts” of American soybeans, a move aimed at easing tensions in the agriculture sector, one of the hardest hit by the trade conflict.