China Suspends 24% US Tariffs for One Year in Trade Thaw

In a significant de-escalation of trade tensions, China has announced a temporary suspension of its 24 percent tariff on US goods. The decision was confirmed by the Chinese finance ministry on Wednesday. This move provides a one-year pause on the higher levy. A 10 percent tariff will remain in place for certain American products.

The policy shift follows a recent meeting between Chinese President Xi Jinping and US President Donald Trump. Their talks occurred on the sidelines of the APEC summit in South Korea. According to Reuters, this decision aims to stabilize the economic relationship between the world’s two largest economies.

Details of the US-China Tariff Suspension

The suspension was formally announced by the State Council’s tariff commission. It marks a notable step back from recent tit-for-tat tariff hikes. Those measures had seen some tariffs cross the 100 percent threshold.

This development follows a prior “truce” negotiated by trade delegations in Geneva. The US had previously agreed to reduce its tariffs on Chinese goods to 30 percent. China reciprocated by lowering its rates on US goods to 10 percent. Both sides had planned to reassess the situation after 90 days.

Broader Impact on US-China Trade Relations

The temporary suspension offers immediate relief for specific sectors. Notably, China will also lift some tariffs of up to 15 percent on US agricultural goods. This is significant as China is the world’s top agricultural buyer.

This thaw follows a period of renewed tension just last month. President Trump had announced plans for 100 percent tariffs on Chinese imports. That move was a response to China’s expansion of rare earth element export controls. In retaliation, China had imposed sanctions on several US-linked subsidiaries.

The latest tariff suspension signals a mutual desire to avoid further escalation. It creates a more stable environment for businesses and global markets. The one-year timeframe provides a window for continued negotiation.

This one-year suspension of the 24 percent US-China tariffs represents a crucial pause in a protracted trade war, offering a renewed chance for diplomatic and economic compromise between the superpowers.

Info at your fingertips

What tariffs did China suspend?

China has suspended its 24 percent tariff on US goods for one year. A separate 10 percent tariff on certain American products will remain in effect during this period.

Why did China make this decision?

The decision follows a meeting between Presidents Xi and Trump at the APEC summit. It is seen as a direct effort to de-escalate recent trade tensions and foster negotiation.

How does this affect US farmers?

The decision is positive for US agriculture. China will also lift some tariffs of up to 15 percent on American farm goods, reopening a vital market.

What was the US response to this move?

The US had previously agreed to cut its tariffs on Chinese goods to 30 percent. This Chinese suspension is a reciprocal step within the broader truce.

Could the tariffs return after one year?

Yes, the suspension is temporary. Both nations are expected to assess the situation and could reinstate the higher tariffs if no lasting deal is reached.

Trusted Sources

Reuters