The United States and China edged closer to a comprehensive trade and tariff agreement on Thursday, as officials on both sides confirmed the signing of a pact that formalizes the informal understanding reached during Geneva talks in May. The move represents a crucial breakthrough in U.S.-China trade relations, which have experienced turbulence since an initial truce unraveled earlier this year.
“We just signed with China yesterday,” President Donald Trump said during a separate event at the White House, though he offered no further specifics. However, statements from both countries confirmed that a framework agreement had indeed been finalized, underscoring a shared commitment to stabilizing economic ties.
A key element of the agreement includes China’s commitment to deliver rare earth materials—essential components in electronics, renewable energy, and aerospace technologies—to the U.S. In return, the U.S. will remove several countermeasures, according to Commerce Secretary Howard Lutnick. “This is a stabilization step, not a final deal, but it’s a foundational one,” Lutnick told Bloomberg.
The interim deal follows continued negotiations held earlier this month in London and comes as the Trump administration works to secure broader trade pacts with other major partners. Lutnick noted that trade deals with as many as 10 other countries—including Canada and Japan—could be finalized within weeks.
Treasury Secretary Scott Bessent expressed optimism that a majority of the remaining U.S. trade negotiations could conclude by Labor Day. “If we can ink 10 or 12 of the important 18 [deals], we could have trade wrapped up by Labor Day,” Bessent said in an interview with Fox Business.
The Trump administration has shown increasing flexibility on its previously self-imposed July 9 deadline to conclude trade talks. Officials, including White House economic adviser Stephen Miran, indicated that the administration would likely extend the tariff freeze for countries that are negotiating “in good faith.”
“You don’t blow up a deal that’s making real, sincere progress by dropping a tariff bomb in it,” Miran told Yahoo Finance. While he acknowledged that the U.S. may maintain an average tariff level near 10% over time, he suggested that some nations may be able to negotiate more favorable terms, while others could face steeper “Liberation Day” tariffs if talks stall.
In Beijing, the Chinese Commerce Ministry released a statement confirming that the two sides had maintained regular communication following the London talks. “Both sides have further confirmed details on the framework,” the ministry said, adding that China will begin reviewing and approving exports of controlled goods, such as rare earths, under its legal guidelines.
The recent developments signal a clear intent from both Washington and Beijing to de-escalate economic tensions that have persisted for years. While the agreement is not yet a full-fledged trade deal, it lays the groundwork for more stable commercial ties and potentially paves the way for a broader economic reset between the world’s two largest economies.
As global markets watch closely, attention now turns to whether the U.S. can complete the remainder of its trade agenda by early September—an ambitious goal that, if met, would mark a significant achievement for the Trump administration ahead of the fall political season.
