US-China Trade Truce Halts Rare Earth Export Curbs, Ends Chip Probes

A major trade agreement between the US and China has been finalized. The deal suspends key Chinese export controls on critical minerals. It also ends antitrust probes into American semiconductor firms.

The White House confirmed the terms in a recent fact sheet. This follows the landmark meeting between the two countries’ leaders. The accord aims to de-escalate a tense trade conflict.

Key Concessions Ease Supply Chain Tensions

China will effectively suspend its restrictive export controls on rare earth metals. This includes gallium, germanium, and graphite. According to Reuters, this move benefits US end-users and global suppliers.

Beijing will also terminate its investigations into US chip companies. This includes major firms like Nvidia and Qualcomm. The probes were widely seen as a retaliatory measure.

In return, the US will pause the implementation of new reciprocal tariffs. A planned 100% tariff on Chinese goods has been halted. This provides relief for businesses on both sides.

A Temporary Truce in a Broader Conflict

The agreement represents a significant short-term de-escalation. It stabilizes relations after months of escalating tensions. Markets have reacted positively to the reduced uncertainty.

However, the measures are initially set to last for one year. This frames the pact as a temporary truce. Long-standing issues over trade practices remain largely unresolved.

US Treasury Secretary Scott Bessent emphasized the need for continued caution. He noted China’s historic dominance in the rare earths market. The hope is that this deal fosters more reliable partnership.

This US-China trade truce provides crucial breathing room for global technology and automotive sectors. The suspension of rare earth export curbs prevents a major supply chain disruption. The success of this temporary agreement will be measured by its ability to build lasting cooperation.

Thought you’d like to know-

What are rare earths and why are they important?

Rare earths are a group of 17 metals. They are crucial for manufacturing high-tech devices. They are used in everything from smartphones to electric vehicles and military equipment.

Which US chip companies were under investigation?

China was conducting probes into major firms like Nvidia and Qualcomm. These were antitrust and anti-monopoly investigations. The deal has now terminated these probes.

How long will this trade agreement last?

The key measures in the pact are set for one year. This includes the suspension of rare earth controls. It is designed as a temporary ceasefire to allow for further negotiation.

What did the US agree to in return?

The US paused new reciprocal tariffs. It also halted a planned 100% tariff on Chinese goods. Certain tariff exclusions for Chinese imports were extended.

Will China resume buying US agricultural products?

Yes, as part of the deal, Beijing agreed to resume purchases. This includes American soybeans. The US stated China will buy a minimum of 25 million metric tons per year for three years.

Trusted Sources

Reuters, Associated Press, Bloomberg