Quick overview
- The United States and China are resuming trade talks in London to address tensions over rare-earth minerals and advanced technology.
- Both countries previously agreed to lower tariffs but accused each other of violating the agreement.
- Trump expressed optimism about the meeting, while China approved certain rare earth element export applications without specifying details.
- Trade tensions escalated this year due to increased tariffs and restrictions on Chinese companies, impacting essential shipments for US defense and technology.
The United States and China are set to resume trade talks in London on Monday, aiming to ease tensions over rare-earth minerals and advanced technology.
When the two parties agreed in Geneva in May to temporarily lower tariffs that had surged to over 100 percent, they accused one another of violating that agreement.
Trump expressed optimism that the London meeting would go “very well” after he and Xi agreed on the flow of essential minerals. On Saturday, China announced that it had approved certain applications for rare earth element exports; however, it did not specify the countries or sectors involved.
Kevin Hassett, head of the White House’s National Economic Council, stated, “We don’t want any technical details slowing that down. We want the rare earths, the magnets essential for cell phones, and everything else to flow just as they did before the beginning of April.”
They can see that trade tensions between the US and China worsened this year after Trump raised tariffs on Chinese goods, which Beijing retaliated against. Although the Geneva agreement was designed to pave the way for a broader de-escalation, subsequent negotiations quickly broke down due to mutual accusations.
The US expressed dissatisfaction over the present shipments of rare-earth magnets, which are crucial for US defense systems and electric vehicles.
The United States’ restrictions on Huawei Technologies Co.’s AI chips angered China, as did software for manufacturing aircraft engines, chips, and visas for over 280,000 Chinese students.
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Olumide Adesina
Financial Market Writer
Olumide Adesina is a French-born Nigerian financial writer. He tracks the financial markets with over 15 years of working experience in investment trading.
