Thaw in trade ties: Trump announces cut in tariffs on China to 47% after meeting Xi; fentanyl-linked duties lowered to 10%

US President Donald Trump and Chinese President Xi Jinping held high-stakes talks in South Korea on Thursday, seeking to ease months of escalating trade tensions between the world’s two largest economies. The discussions, described by both sides as constructive, touched on tariffs, agricultural trade, and cooperation on curbing fentanyl exports — issues that have strained ties since early this year.

Tariff cuts and trade relief

Trump announced that overall tariffs on Chinese goods would be reduced to 47 per cent from 57 per cent, and fentanyl-related tariffs cut to 10 per cent. On being asked, " how soon do you think you could sign a trade deal with China?" Trump replied, "Well, I think pretty soon. We have not too many major stumbling blocks. We have a deal now. Every year we'll renegotiate the deal, but I think the deal will go on for a long time, long beyond the year. We'll negotiate at the end of a year."




Speaking specifically on the fentanyl issue, Trump told reporters after the meet, “We’re cutting fentanyl tariffs down to ten per cent after very good talks." “I expect to be lowering that because I believe that they're going to help us with the fentanyl situation,” Trump further said.

He also said the broader trade dispute between the two countries had been “settled,” describing the discussions with Xi as “very positive” and adding that “there’s a lot of understanding.”

Rare Earths

President Donald Trump said on Thursday that his meeting with Chinese President Xi Jinping resulted in a one-year agreement on the supply of key rare earth materials, which can be extended annually.

“All the rare earths have been settled — and that’s for the world,” Trump told reporters aboard Air Force One, adding that the deal would be reviewed and renegotiated each year.

Energy

US President Donald Trump said on Thursday that China has agreed to start talks on purchasing American energy. “In fact, a large-scale transaction could take place involving the purchase of oil and gas from the great state of Alaska. Chris Wright, Doug Burgum, and our respective energy teams will meet to explore the possibility of such a deal,” Trump wrote on Truth Social.

Agriculture boost

Trump said China would immediately resume purchases of American soybeans, signalling a return to agricultural cooperation that had been disrupted by tariff battles. "Large amounts, tremendous amounts of the soybeans and other farm products are going to be purchased immediately, starting immediately. If you notice, President Xi authorized yesterday for China to start. Did you know that? Right. In very large quantities of soybeans and other things, which I appreciated. That was a very nice gesture," said the US President.

Turning point for ties?

The developments follow months of heightened trade frictions and could mark a turning point in efforts to stabilise US–China economic relations. Trump rated his meeting with Xi “on a scale of 1–10 being 12,” hinting at possible optimism about renewed ties. He also announced that he would visit China in April next year, continuing what appears to be a diplomatic reset, and could build on the momentum from the Busan talks.