China and US agree to mutually reduce tariffs
How do you say “status quo ante” in Chinese?
On Monday, the US and China released a joint statement following weekend trade talks in Geneva.
- Chinese Vice Premier He Lifeng headed the Chinese delegation, while US Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer led the US side.
The headline: China and the US agreed to a 90-day pause, effective Wednesday, during which the US will reduce tariffs on Chinese goods from 145% to 30%, and China will lower its tariffs on US goods from 125% to 10%.
- In the statement, the two sides also committed to establishing a consultation mechanism for trade and economic issues.
At a subsequent press conference, Bessent hailed the deal as a step forward, telling reporters (FT):
- “Neither side wants a decoupling.”
- “We want more balanced trade, and I think both sides are committed to achieving that.”
China’s commerce ministry (MofCom) said that the agreement was “an important step for the two sides to resolve differences through equal dialogue and consultation.”
Get smart: The tariff rollback represents a clear vindication of Beijing's calculated, proportional approach to responding to the Trump administration’s trade actions.
Get smarter: Monday’s deal is a ceasefire, not a peace treaty.
- It’s totally possible that continued disagreements could lead to a resumption of hostilities down the line.
The long view: Even with the pause, global supply chain volatility is the new normal.
- Companies and governments would be wise to plan accordingly.