Trump Reveals New Trade Agreement with China: A Shift in Economic Relations

BANGKOK — A recent publication by Bloomberg reveals that the U.S. and China have finalized a trade deal aimed at easing American access to essential minerals and magnets from China, crucial for manufacturing and microchip production. This proclamation was made by U.S. Treasury Secretary Scott Bessent on June 27.

This agreement follows China’s response to significant import tariffs imposed during the Trump management, which had previously slowed down the export of rare earth minerals vital for various industries in the U.S.

Bessent shared insights on Fox Business network’s “Mornings with maria,” mentioning that a conversation between Trump and Chinese President Xi Jinping paved the way for this agreement. He expressed optimism about resuming magnet exports as per their discussions.

The US and China have finalized a trade understanding reached last month in Geneva, US Commerce Secretary Howard Lutnick told @kaileyleinz and @jmathieureports on “Balance of power” https://t.co/qZyEIt78e6 pic.twitter.com/qQXIC8eK7r
— bloomberg TV (@BloombergTV) June 26, 2025

This pact has opened doors for ongoing negotiations after previous tensions led to halted sales of critical technologies like jet engine components from the U.S. Though, there’s also been an agreement not to revoke visas for Chinese students studying in America.

The Path Forward

Bessent noted that this development signifies a de-escalation in trade tensions between both nations.

Citing comments from Commerce Secretary Howard Lutnick on Bloomberg TV earlier this week, he confirmed that they had officially signed off on this deal.

The Chinese Commerce Ministry stated that both parties have further clarified details regarding their framework but did not specifically mention access to rare earths central to these discussions.

“china will review eligible export applications according to its laws while the United States will lift several restrictive measures it had placed,” they added.
 

The initial talks held in Geneva back in May were crucial as they postponed potential tariff hikes threatening extensive trade disruptions between these two economic giants. Subsequent meetings in London helped solidify frameworks leading up to Bessent’s remarks last Friday.
 
China has yet to announce new agreements but indicated it would expedite approvals related to rare earth exports used extensively across high-tech sectors like electric vehicles.
Beijing’s restrictions around these materials have been contentious points throughout negotiations.
 
 
The Chinese government mentioned accelerating reviews of export licenses for rare earths while approving several compliant applications recently.

While China maintains its control over these exports through regulations applicable globally—not just targeting American markets—it retains flexibility over approval processes based on demand.

Recent developments show how export controls overshadowed tariffs during negotiations after Beijing introduced permitting requirements affecting seven key rare earth elements back in April—potentially disrupting production across various high-tech industries worldwide.

Additionally, addressing concerns surrounding fentanyl trafficking has become part of broader discussions; last week saw announcements regarding stricter regulations around precursor chemicals linked directly with fentanyl production—a move prompted by pressure from Trump who previously imposed hefty tariffs due largely due drug-related issues.

The May Geneva agreement called upon both sides’ commitment towards reducing punitive tariff increases initiated amid escalating trade conflicts under Trump’s administration—though some higher tariffs remain intact concerning specific goods such as aluminum or steel imports.

As we navigate through rapidly changing policies impacting global economies—the repercussions are evident; recent data shows contraction within America’s economy at an annual rate of 0.5% early this year partly driven by surging imports ahead of anticipated tariff implementations.

Simultaneously occurring—in China—factory profits plummeted over nine percent year-on-year during may—with automakers particularly hard hit experiencing declines exceeding one percent within January-May timeframe.

looking ahead—Trump along with other officials express optimism about reaching favorable deals across multiple nations including India stating confidently “We’re going into deal after deal.”

Weissert reported from Washington while Associated Press writer didi Tang contributed additional insights also originating outta Washington.