U.S. Treasury Secretary Scott Bessent announced Sunday a tentative agreement between Washington and Beijing that will allow China to delay rare earth mineral export restrictions for one year while resuming purchases of U.S. soybeans.
The agreement avoids, for now, a 100% increase in the tariffs previously announced by President Donald Trump.
The US president had warned that if China were to implement global controls on rare earth exports, the United States would impose a 100% tariff increase on Chinese products starting November 1, a move that ultimately failed to materialize after bilateral discussions. “I think we’ve averted that,” Bessent said on ABC’s This Week program, confirming that Beijing would also resume “substantial agricultural purchases,” one of Washington’s demands.
Regarding the restrictions, the US official specified that China agreed to “delay them for a year while it reexamines them,” a concession that was negotiated this week in talks led by Vice Prime Minister He Lifeng in Kuala Lumpur. These meetings coincided with the sixth summit of leaders of the Association of Southeast Asian Nations (ASEAN) held in the Malaysian capital, which Trump attended.
For his part, China's International Trade Representative Li Chenggang reported at the end of the talks that a"preliminary agreement" had been reached, noting that both sides had explored"suitable proposals to address mutual concerns." According to the transcript released by the official Xinhua news agency, the next step will be for each country to complete its respective internal approval procedures.
The Chinese official indicated that the talks with Washington—the fifth round since April, following the last meeting in Madrid—addressed “numerous issues,” including export controls, the extension of the reciprocal suspension of tariffs, and cooperation to combat the trafficking and consumption of fentanyl. Measures related to U.S. tariffs on Chinese ships were also discussed, as well as the possible expansion of bilateral trade. Li acknowledged that the United States maintained a “firm” stance, while Beijing “resolutely defended” its interests.
Bessent himself said hours earlier, in a press conference, that Beijing and Washington have laid “a very solid foundation for a successful meeting” scheduled for October 30 in South Korea between Trump and Chinese President Xi Jinping. According to the US spokesperson, both governments discussed issues including trade, rare earths, fentanyl, the social network TikTok and the state of bilateral relations in general.
U.S. Trade Representative Jamieson Greer said the delegations had finalized details of the agreement, which will require approval from the leaders of both powers. During the day, Trump expressed optimism about the possibility of a good agreement with Xi and suggested future meetings in both countries.
The negotiations in Kuala Lumpur served as preparation for the upcoming Trump-Xi summit—not yet confirmed by the Chinese government—in an environment marked by tensions arising from China's dominant position in the rare earth market, minerals essential to the technology industry.
In response to Beijing's measures, the White House raised the threat of imposing tariffs of 100%, which could increase effective rates to 157%. This comes in addition to the implementation of reciprocal port tariffs in the middle of the month and the opening, last Friday, of a US investigation into China's alleged non-compliance with the 2020 trade agreement, a pact that Beijing claims to have respected"scrupulously."
At the end of the talks, Deputy Prime Minister He Lifeng called for “jointly preserving the achievements made” in the Malaysian capital, stressing that the stable development of bilateral trade and economic relations “serves the fundamental interests of both countries and their peoples.”
