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In a significant diplomatic breakthrough, Chinese President Xi Jinping announced that economic and trade teams from China and the United States have reached a consensus on addressing key trade disputes. The announcement came following his meeting with US President Donald Trump in Busan, South Korea on the sidelines of the 32nd APEC Economic Leaders’ Meeting held in Gyeongju. This was the first face-to-face meeting between Xi and Trump since the latter returned to the White House. The two leaders discussed a range of contentious issues, including the ongoing trade war, tariffs, rare earth mineral exports, and agricultural trade, particularly the export of American soybeans to China. What did Xi say? President Xi emphasised that trade and economic relations should serve as the “ballast and driver” of bilateral ties rather than becoming sources of tension. He urged both sides to focus on long-term cooperation and mutual benefit instead of engaging in cycles of retaliation. “The economic and trade teams of both nations should continue to narrow down the list of problems while expanding the scope of cooperation based on equality and respect,” Xi said. He also reiterated China’s commitment to fostering a stable and predictable economic environment on the principles of equality, respect and mutual benefit despite ongoing differences. Trump calls meeting a ‘great success’ US President Donald Trump described the talks as “a great success,” rating them “12 out of 10.” He expressed optimism about signing a comprehensive trade deal in the near future and announced plans to visit China in April 2026 for further negotiations. In a move seen as a goodwill gesture, Trump announced a reduction in tariffs on Chinese goods from 57% to 47%. Additionally, the United States has halved tariffs on fentanyl-related imports from China from 20% to 10% as part of the confidence-building measures. Rare earth deal One of the key achievements of the meeting was an agreement on rare earth mineral exports. Both sides confirmed a one-year, extendable deal allowing continued Chinese exports of crucial rare earths essential for technology, defence, and manufacturing sectors. Trump declared the rare earth dispute “settled” and emphasised that the agreement would be reviewed and renegotiated annually.
