Busan: US President Donald Trump announced on Thursday that he has reached an agreement with Chinese President Xi Jinping to lower tariffs on Chinese imports. This decision follows discussions in which China committed to addressing illegal fentanyl trafficking, resuming purchases of US soybeans, and ensuring the continuous export of rare earth elements.
According to Thai News Agency, the meeting between Trump and Xi in Busan, South Korea, marked their first encounter since 2019. This meeting concluded Trump’s Asia tour, during which he highlighted trade developments with South Korea, Japan, and other Southeast Asian countries.
Trump shared with reporters on Air Force One that he considered the meeting with Xi “amazing,” awarding it a 12 out of 10 rating. As part of the agreement, tariffs on Chinese imports will be reduced from 57% to 47%, and tariffs on fentanyl will be halved from 20% to 10%. Trump emphasized that these reductions are a response to China’s commitment to curbing the flow of fentanyl, a major contributor to overdose deaths in the US.
The announcement led to volatility in global stock markets, with fluctuations observed in major Asian indices and European futures. China’s Shanghai Composite index experienced a decline from a 10-year high, while US soybean futures saw a drop.
The meeting, held on the sidelines of the Asia-Pacific Economic Cooperation (APEC) summit, lasted nearly two hours. Trump’s ongoing hints at a potential deal with Xi came to fruition, building on a framework agreed upon by US negotiators to avoid 100% tariffs on Chinese goods and delay restrictions on Chinese exports of rare earth minerals.
During the talks at a South Korean air base, Xi expressed to Trump through an interpreter that occasional clashes between major powers are normal. He stated that trade negotiators from both nations had reached a basic consensus on addressing mutual concerns and conveyed his willingness to continue collaborating with Trump to strengthen China-US relations.
Besides the fentanyl tariffs, China seeks the relaxation of US export controls on sensitive technologies and the removal of new US port fees for Chinese ships. Trump did not immediately address these concessions but confirmed that China would begin purchasing large quantities of US soybeans and other agricultural products right away.