Eppe Franklyne –
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The US and China have reached a new trade agreement after two days of negotiations in Geneva.
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US Treasury Secretary Scott Bessent described the talks as “productive,” with details of the deal to be released soon.
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The agreement comes amid the US’s $1.2 trillion trade deficit and a need for a resolution.
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India, which benefited from US tariffs on China, may lose market share if tariff reductions are part of the deal.
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China’s overall exports are growing, despite a dip in exports to the US in April.
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Former President Trump called the agreement a “total reset” for US-China trade relations.
The United States and China have successfully reached a new trade agreement following two days of intense negotiations in Geneva, as confirmed by a statement from the White House on Sunday. US Treasury Secretary Scott Bessent described the discussions as “productive” and indicated that the full details of the agreement would be unveiled on Monday. He expressed confidence in the substantial progress made between the two nations in these pivotal trade talks.
US Trade Representative Jamieson Greer noted the swift consensus reached by both parties, suggesting that the differences between their positions may have been narrower than expected. He pointed out that substantial groundwork had been laid in advance of the talks. Greer also highlighted the urgency of the situation, referencing the US’s $1.2 trillion trade deficit and the President’s prior decision to impose tariffs and declare a national emergency. This new deal is seen as a crucial step in addressing that deficit.
The agreement marks a significant turning point in the ongoing trade tensions, which had previously led US importers to turn to India after the imposition of steep 145% tariffs on Chinese goods. Indian exporters had benefited from this shift, but the new trade deal with China could see China reclaim some of its lost market share, potentially undermining India’s recent gains. In fact, Chinese companies have reportedly approached Indian exporters for help in fulfilling US orders, eager to retain their American clients.
If the deal includes tariff reductions, India’s advantage could diminish significantly. Despite a 20% decline in China’s exports to the US in April, China’s overall exports have risen by 8.1% year-on-year, fueled by strong trade with ASEAN and other regions, according to China’s Ministry of Commerce.
White House economic adviser Kevin Hassett remarked that China was “very, very eager” to strike a deal and rebalance trade relations, hinting that the US might soon announce additional trade agreements with other nations.
Former President Trump weighed in on the negotiations, calling them a “total reset” of US-China trade relations. He described the talks as conducted in a “friendly, but constructive” manner, expressing hope for China to open up to American businesses for the benefit of both countries. “Great progress made!” he wrote on Truth Social.
