Trump and Xi Meet: Hopes Rise for Trade Truce

BUSAN, South Korea — U.S. President Donald Trump and Chinese President Xi Jinping met for the first time in six years, sparking hopes for easing tensions between the world’s two largest economies. The high-stakes discussion took place on Thursday during Trump’s trip to Asia.

Trump described the talks as ‘amazing,’ and said that both leaders reached a consensus on ‘major trade issues.’ Relations between the U.S. and China have significantly strained since Trump imposed tariffs on Chinese imports, prompting retaliatory measures from Beijing.

Although the meeting did not conclude with a formal agreement, it was seen as a step toward resolving ongoing trade conflicts. After an initial truce in May, tensions have lingered, particularly related to tariffs impacting U.S. farmers and manufacturers.

Notably, China agreed to suspend its export control measures on rare earth materials, essential for numerous technologies, including smartphones and military equipment. Trump touted this as a major victory from the discussions.

Encouraged by the outcomes, Trump announced that China would immediately start buying ‘tremendous amounts’ of U.S. soybeans and other agricultural products, following Beijing’s retaliatory tariffs that had previously halted imports. Scott Bessent, U.S. Treasury Secretary, confirmed that China agreed to purchase 12 million metric tonnes of soybeans this season, with a minimum commitment of 25 million tonnes annually for the next three years.

In the wake of the meeting, the U.S. also decided to reduce some tariffs related to the import of chemicals used in fentanyl production. Trump’s administration has faced pressure to address the flow of fentanyl into the U.S., which has contributed to the opioid crisis.

Sean Stein, president of the US-China Business Council, remarked that the meeting provided a long-overdue pause on tariff escalations, allowing businesses to focus on critical economic issues impacting trade relations.

However, despite the optimistic announcements, some tariffs still remain, with U.S. importers facing over 40% tax on goods brought in from China. Both nations plan to engage in further discussions to solidify trade agreements, indicating movement towards potential solutions to longstanding issues.

Additionally, Trump revealed that China extended an invitation for him to visit in April, signaling a thaw in relations. During the meeting, Xi maintained a composed approach, sticking closely to his prepared remarks, indicating a strong negotiating position for China.

The atmosphere around the meeting was notably less extravagant compared to previous stops on Trump’s Asia tour, reflecting the seriousness of the trade negotiations. Pundits suggested that while the talks were positive, much work remains to be done.

As discussions continue, analysts stress the importance of moving towards a workable framework that benefits both economies, paving the way for more substantial trade negotiations in the future.